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Car Parking at Office - paid by employer

Tax implications - Benefit in kind

We pay for our employees car parking at the office - nearly £500 per person per year. Do we have to include on P11D or can we make a separate arrangement with HMRC that we (the company) pay. We don't want our employees to suffer any financial/tax charge for this issue.

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21st Mar 2018 16:51

Why hasn't your accountant told you that it isn't taxable?

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to Portia Nina Levin
21st Mar 2018 16:54

@Nina - because it might be taxable under the 2017 optional remuneration rules? Wild guess :-)

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21st Mar 2018 16:53

If it's NOT an optional element of the remuneration package, it's tax-free. ITEPA s237 (and s266 for vouchers/cards). No reporting needed. Nothing has changed.

If employees get a choice to take the car parking or the cash, it's now a taxable benefit. ITEPA, s69A. If the arrangements were in place before 6 April 2017 and haven't changed, they are still currently under the old rules above. If there has been a change, or a new employee is given the optional benefit after 6 April 2017, the new rules apply. The new rules will apply to old optional arrangements from 6 April 2018 (but not to free parking where there is no optional element - old rules still apply).

If you pay the provider (eg, buy a batch of season tickets), it's a P11D item, but you can opt to payroll it. If you reimburse the employee, it's wages.

Read EIM44030 on GOV.UK.

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By possep
21st Mar 2018 16:53

Google HMRC PAYE manual 480. It's in that.

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21st Mar 2018 17:07

Thanks everyone - helpful info. I will look into it further in the morning.

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