I am looking at the way our company report to our clinet's payroll depts for payment of car benefits to their employees.
The employee needs to end up with a given net figure each month. Lets say £340 for this example.
Assuming the driver pays tax at 40% and NI at 1%, I would expect the grossing up to be as follows:
£340 net, gross up for PAYE @ 40%
£340 x 100/60 = £566.66
Gross up fo NI @ 1%
£566.66 x 100/99 = £572.39
Then apply 12.8% EmployERS NI to this. Job done!
Now, is that it? OR, is the employEES NI (£5.72 in this case) subject to extra PAYE? i.e., is the paying of the employers during the grossing up for NI deemed to be a benefit in kind to the employee?
I have had differing opinions on this and I need it sorting.