The following Employment Tax guidance note Produced by Tolley in association with Robert Woodward provides comprehensive and up to date tax information covering:
While the optional remuneration rules effective from 6 April 2017 affect the taxable amount of many benefits provided under salary sacrifice, attention is still required for the salary sacrifice agreement itself and the existing rules regarding changing the agreement itself still apply.
The concept of salary sacrifice is based on a tax case which was lost by the taxpayer. However, applying the reasoning from the case and based on the interpretation by HMRC (in particular see the GOV.UK website and EIM42700), salary sacrifice can be used as a workable employee benefits delivery tool.
In 1961, Mr Bell entered into a scheme with his employer under which, for a reduced salary, he could have the use of an Austin, which he could return if 14 days’ notice was given and see his salary revert to its original level. The tax treatment of the ‘payment’ made by Mr Bell was challenged by the Inland Revenue and led to the 1971 House of Lords’ ruling in Heaton v Bell. It was ruled that Mr Bell was still entitled to the same gross
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Income and gains may be taxable in more than one country. The UK has three ways of ensuring that the individual does not bear a double burden:1)treaty tax relief may reduce or eliminate the double tax 2)if there is no treaty, the individual can claim ‘unilateral’ relief by deducting the foreign tax
From 6 April 2015, an individual can elect to transfer 10% of the personal allowance (£1,250 in 2020/21 and 2019/20) to the spouse or civil partner where neither party is a higher rate or additional rate taxpayer. The legislation calls this the ‘transferable tax allowance’ but the GOV.UK website
Employee benefit trusts (EBTs) are commonly used to support employees’ share schemes and to provide other benefits to employees in the form of pensions and bonuses.Their use has been significantly affected by the introduction of the disguised remuneration rules. Although the statutory exclusions
Class 1 and Class 1AClass 1 and Class 1A are the categories of NIC that can be charged on expenses reimbursed and benefits provided to employees. These classes are mutually exclusive. A benefit cannot be subject to both Class 1 and Class 1A NIC. Three requirements must be met before Class 1A NIC is
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