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‘Making good’ on benefits in kind

An employee can make a payment to their employer to reduce the taxable value of a taxable benefit, often to zero (making good). There is a deadline of 6 July after the end of the tax year for making good on benefits in kind.  The taxable value, and the value on which Class 1A National Insurance are payable, will be reduced only if the benefit in kind is made good by that date.

There are different rules for making good on benefits in kind which are payrolled. The basic rule is that the benefits and expenses need to be reimbursed by the employee before the final pay day.

However, for payments to reimburse private fuel for a company vehicle or private expenditure on a company credit card the deadline is the 1 June following the end of the tax year.

 

 

Date: 20th March, 2018
Author: Jacqui Gudgion

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