The following Employment Tax guidance note Produced by Tolley in association with Paul Tew provides comprehensive and up to date tax information covering:
Employers will often meet the liabilities of their employees when they arise as a consequence of their employment duties. To cover these liabilities, an employer will often take out an insurance policy.
Legal proceedings can be instigated against employees or directors either by other employees or by third parties. Often, the legal costs and any resulting liabilities will be met by an employer. An employer may choose to purchase insurance to meet all such costs.
If an employer meets the liabilities of an employee or purchases insurance on their behalf, then, typically, a tax charge will arise under ITEPA 2003, s 62 (see the Contractual and pecuniary liabilities guidance note).
However, in some circumstances, there may not be a charge to tax.
ITEPA 2003, ss 346–347 provide relief for the costs of liabilities and insurance costs whether incurred by an employer or by an employee. A deduction can be claimed in relation to:
the liabilities of the employment
costs and expenses associated with a liability
the amount of an insurance premium
This relief also extends to Class 1 NIC.
The costs must be incurred in relation to a qualify
**Free trials are only available to individuals based in the UK. We may terminate this trial at any time or decide not to give a trial, for any reason.
Access this article and thousands of others like it free for 7 days with a trial of TolleyGuidance.
Read full article
Already a subscriber? Login
If an individual sells a chargeable asset and makes an allowable loss, how can this be relieved?First of all, since the simplification of capital gains tax from 6 April 2008, the proforma to calculate a loss is the same as the proforma to calculate a gain. See the Basic calculation principles of
Statutory references to ITTOIA 2005 relate to unincorporated businesses and CTA 2009 relate to companies unless otherwise stated.Legal and other professional fees can represent substantial costs to a business. A detailed analysis is often required for the purpose of preparing tax computations as
Why do we need to calculate these amounts?This guidance note sets out details of the initial calculations a group will need to undertake for the purposes of the corporate interest restriction (CIR) regime. For a general overview of the regime, see the Corporate interest restriction ― overview
Introduction to the regimeThe aim of the patent box regime is to provide an incentive for companies to develop and retain patents and other qualifying intellectual property within the UK as part of the Government’s growth agenda. Finance Act 2012 originally introduced the legislation governing the