Can the director pay back the money to company??

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Suppose a special subscription services should be solely used by company business purpose. However, this service is not for business purpose sometimes.

The last tax year this special subscription services annual fee (around GBP 120/year) had already paid by director and reimbursed fully (paid back to director) and the tax return had reported this transaction.

This tax year this special subscription services annual fee had already settled by direct debit from the company bank card.

If  the director will pay back part or full this special subscription services fee for both years to aviod the query from get the benefit in kind, what can he do now?? Any other suggestions or solutions are welcome.

 

Many thanks in advance.

 

 

 

Replies (7)

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By DKB-Sheffield
20th Feb 2024 23:52

Sooo sorry, but I don't really understand the question... in actual fact I can't find the relevant question.

I would, however, suggest your accountant and/ or tax adviser may be able to put 2 and 2 together and suggest and answer in the region of 3 and 5?

Without knowing details such as... which tax years (on-time, in-time, late), was the BiK reported and you wish to 'correct' (?), what is a 'special subscription'*... it's difficult to even guess.

The big concern is that we're only talking about £240. Who knows what bigger fish you may be poaching instead of frying!

However, when you use words like 'avoid' I have chills down the back of my neck! For that reason, I wouldn't want to answer at all!

* I am guessing a 'special subscription' may be Amazon Prime or something similar. However, even that wouldn't be a simple answer!

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By FactChecker
20th Feb 2024 23:55

Difficult to guess what "a special subscription service" could be ... which may affect any answers.
When you say "should be solely used by company (for) business purpose", presumably you mean in terms of whether any payment for it will be allowable as a deduction from taxable profits?
And "this service is not for business purpose sometimes" avoids the more important question of whether, when it IS used for business purposes, that use is W & E.

From there onwards, your post becomes harder to understand ... are you more concerned with who is paying for the service? or where to record those transactions in company's books? or what if any impact they have on BiK taxes for the Director?

What all that should tell you is that you need an accountant and your company should appoint one ... not hope for unreliable answers to potentially the wrong questions on a public forum.

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Replying to FactChecker:
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By rmillaree
21st Feb 2024 09:04

Difficult to guess what "a special subscription service" could be

Oooooh go on you know you want to have a guess here

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Replying to rmillaree:
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By rmillaree
21st Feb 2024 09:05

my guess would be pretty boring amazon prime

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By Cylhia66
21st Feb 2024 04:22

To the question "Can the director pay back the money to company??" the answer is yes.

As others have said, it's difficult to answer your other questions as it's not clear what you're asking.

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By Tax Dragon
21st Feb 2024 05:55

The general rule is that an employee 'making good' [=paying or repaying] an employer expense reduces any benefit in kind based on that expense IF (and only if) the making good is by 6 July following the tax year.

Search "making good benefits in kind" or similar.

Anything else you can do? Change the existing direct debit? Keep the company bank card in the company wallet/purse and away from your own? Appoint an accountant?

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VAT
By Jason Croke
21st Feb 2024 10:29

I reckon it's either Spotify or OnlyFans.

Either could have a business purpose....depending on the business.

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