Benefit in Kind - Reward points redeeming

Rewards from suppliers of vouchers/days out/goods are 'earned' by the company. Tax implications?

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Our company 'earns' rewards from suppliers for trade. These reward points can be redeemed form their cataglogue for vouchers/tools/hampers and days out. What is the tax benefit of giving this reward to our employees? There is no cost to us. 

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By Tax Dragon
10th Jul 2024 13:51

sandravr-AT-pcbtechnicalsolutions.co.uk wrote:

There is no cost to us. 

There is presumably a cost to someone.

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Replying to Tax Dragon:
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By [email protected]
10th Jul 2024 14:54

Thank you for responding. Yes the cost is with the supplier for providing the benefit, but if we don't redeem the points we don't get any 'cash value' as an alternative.

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By Tax Dragon
10th Jul 2024 15:02

Normal rule is the taxable amount of the benefit is the total cost of providing it. (Specific rules may take precedence over the normal rule - eg you mention vouchers.)

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Replying to Tax Dragon:
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By [email protected]
10th Jul 2024 15:13

Thank you , that's helpful.
The vouchers are love2shop vouchers. These don't cost us anything but I understand that they have a value, and could potentially be well over £50 per employee. Would the 'value' be a benefit in kind even if as a company it didn't cost us anything?

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By Tax Dragon
10th Jul 2024 15:26

Surely this is covered in your employer guide (480)?

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By FactChecker
10th Jul 2024 17:48

That seems (to me) to change everything.
If the vouchers were for 5% discount on future purchases of garden soil (for instance) then there's probably not much of an established market in said vouchers; but 'love2shop' are almost cash (in that they can be used to buy a wide range of products and services from a wide variety of suppliers) - you can even buy them at a discount on sites like ebay!

But the claim that "they don't cost us anything" is therefore not true, as the company can easily use them. Whether this is to buy things for the company or to issue to employees, it is an item of value (to the company) being used - and so costing the company.

And that's before you get to the 'lucky' employee perspective. It's debatable if the voucher (given that it can be converted to cash) counts as taxable earnings - but if not, it must surely be a BiK?

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By David Ex
10th Jul 2024 15:36

sandravr-AT-pcbtechnicalsolutions.co.uk wrote:

There is no cost to us. 

Oh, free, just like professional advice. Nice!

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By Paul Crowley
10th Jul 2024 16:43

Are you seriously telling me that the company cannot redeem these points for an item of value?
https://www.gov.uk/expenses-and-benefits-third-party-awards/what-to-repo...
Who distributes the points?

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