Non-Resident Director - Benefit in Kind on Motorbike

Non-Resident Director - Benefit in Kind on...

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I have a client who is Non-Resident.  He is a sole Director and Shareholder of a UK limited Company.

He is looking to purchase a motorbike in the company, which he will use whilst abroad and will also occasionally, bring the bike to the UK to attend to client meetings & other company business.

In normal cases a director would be liable for a BIK of 20% on the cost plus the private % of running costs (fuel, insurance, maint etc). But I understand that there are no BIK 's because my client is non-res for UK tax?

I believe that the input VAT claim on the motorbike, will have to allow for private use and only the business element claimed?

Because he is non-res am I correct in thinking:-

  • there will be no BIK on the motorbike? 
  • there will be no Class 1A for the company?
  • the company can claim AIA's on the bike
  • all of the running costs will be deductible within the company? 
  • the input vat claim on the running costs will be reduced to take account of the private use?

Assuming that my assumptions above are all correct, then:-

  • Because the client will be undertaking duties within the UK for the company, will he incur a taxable benefit on the Motorbike?
  • If so, will the company then have to register for PAYE and issue a P11d to the Director?
  • Is there anything else I am missing here?

Any answers on this would be greatly received.

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By Helen Crowley
29th Apr 2014 16:52

New SRT

First of all are you completely certain that he will be classed as non-resident under the new rules? The new Statutory Residence Test catches quite a few people that weren't classed as UK Resident before 6/4/13.  

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