Deducting damages from employee pay - taken from net or gross?
I got asked this question yesterday, and i should probably know the answer, but it hasn't come up before in my short career and therefore intrigued me to find out for my own sake. I've looked all round google and HMRC docs to find the answer, but still cannot see it in black and white. So now i seek the help of accountingweb members.
If it had been agreed in the employment contract that damages incurred to equipment etc could be deducted from employee pay, would these be deducted from the gross or net figure?
I'm heavily lent toward it being deducted from the net, only because what i have learnt about pre tax deductions consists mainly of pensions and similar.
It makes sense that these expense are incurred for the purpose of the trade (IE wouldn't have been incurred anyway, required to get business back to operating as before) however i have also seen a case whereby other damages were not allowable as a pre tax deduction as it effectively shared the burden with society.
Maybe i have read to much into this now and have muddled my own thinking, so please can someone just clear this up and point me in the right direction.
- Self-assessment statistics 2,468 59
- Entrepreneur - want to submit accounts by myself 210 5
- Transmission of ISA 47 2
- Bench-marking software, any ideas? 175 2
- Next Move 711 20
- Separate companies same Director buy from each other 172 2
- Not renewing AAT 672 9
- CGT of shares gifted 381 6
- New dividend taxation 488 3
- Accountant won't release working papers 2,795 51
- Co purchase printed materials from EU - VAT 151 1
- Company car v company allowance 278 1
- Furnished Lettings - expenses normally bourne by tenant 437 9
- Company formation and bank account 433 9
- Owning overseas property 341 2
- MLR and benefitting from the disclosure 290 1
- Company Car for Owner Director number crunching - is there a ready reckoner? 272 3
- How did you recalculate your payroll fees 710 8
- Client tied in to accountant. Unfair contract? 726 9
- Importing Sage Data and Year End 277 2
- Self employed and HMRC Worldwide Subsistence Rates 667
- Acrobat Checkbox Help for New 64-8 409
- Property letting & CAs 399
- Interest paid - do new rules affect Tax Credits? 395
- 2015 tax year end 395
- FCA regulated company in a small group 347
- Self employed consultant working in Ireland 320
- Market Invoice (P2P invoice discounting) tax treatment 241
- DTA tie-breaker issue 211
- Tax on internet ad sharing income 204