Non NIC-able benefits

By Tolley

The following Employment Tax guidance note by Tolley provides comprehensive and up to date tax information covering:

  • Non NIC-able benefits
  • Benefits in kind
  • Other non NIC-able benefits
  • Position for 2015/16 and earlier tax years

Benefits in kind

The Class of NIC charged in respect of most benefits in kind is Class 1A, but that liability only arises if a benefit is chargeable to tax. This means that if a benefit is exempt from tax, it is also exempt from Class 1A NICs.

The Non-taxable benefits guidance note includes a list of the main exemptions from tax for non-cash benefits. Any item covered by one of those exemptions is also exempt from Class 1A NICs.

As from 6 April 2016, this includes items that come within the general exemption for expenses and benefits that are matched by a deduction that would otherwise be allowable to the employee (see the Expenses and benefits matched by allowable deductions guidance note).

More on Benefits — general principles: