I will be completing a PAYE settlement for a client shortly that covers 8 employees on a joint BIK. This is not seperable but is a chunky sum.
There are two complications:
1. For one employee is basic rate per their P60, but their share of the substantial BIK would push them into higher rate. Do I need to apportion the settlement and gross up at higher for some, and basic for the rest, or can I gross up the lot at basic rate?
The (old) guidance just says "the marginal tax rates"
http://webarchive.nationalarchives.gov.uk/+/http://www.hmrc.gov.uk/guida...
and the .gov site is dumbed down too far to comment:
https://www.gov.uk/paye-settlement-agreements/overview
2. One basic rate employee and the BIK would not be enough to make them higher rate. But they have other income that make them HR. I know this as I also act for this employee and file their personal tax return. But with my company PAYE clerk hat on, is is safe to ignore this 'extra' information for the settlement? I think I am worrying too much.
Also for extra credit and my understanding:
3. Connected to (2) if one was a company director on a low wage/high dividend strategy can we still just gross up at BR? Seems unlikely or its a nice little loophole to get BIK's at basic rate, but again I cant see anything saying we have to do this.