Expenses claim for Wifi booster at home - BIK?

Wifi booster at home - BIK?

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I have a director who has claimed for a set of WiFi boosters for his home. His argument is that it is for work use regarding laptop and mobile and therefore should not be taxable. I dont believe you can specifically say that this is for work use as it will be used for personal use by him and his family 100% of the time. I have another director saying that they are assets and we can take them back at some point so they also believe it shouldnt be incuded on the P11d. Its only £150 so we would not capitalise even if they were 'assets'. 

Whats the general view on this?

Replies (12)

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By Tax is always taxing
29th May 2024 09:32

So you are saying its 100% private use and no business use or benefit? That's a bold assessment.

In all honesty, its £150, I wouldn't even give it much of a thought.

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Replying to Tax is always taxing:
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By Tax Dragon
29th May 2024 09:37

You'd "stick it straight to DLA", as per the Aweb norm?

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By ireallyshouldknowthisbut
29th May 2024 09:43

Im not sure it matters *what* the item is. The same principles apply to virtually all business/private/shared costs.

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By SarahS2908
29th May 2024 09:44

im not saying its 100% private use but its also not 100% business use either, thats why i am questioning it. Is there a ratio that HMRC would agree with for it not to be a BIK?

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Replying to SarahS2908:
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By Tax Dragon
29th May 2024 10:03

Well, yes - if there's an exemption from the BIK, as would have been provided by s320 ITEPA had it not been repealed.

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By JustAnotherUser
29th May 2024 10:31

I know plenty who have access points for garden offices / out houses which will not benefit family members in the house. Source, myself.. 1 access point for work only, another separate one for the garden.

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Replying to JustAnotherUser:
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By Tax Dragon
29th May 2024 11:30

That tells nobody anything. Maybe you personally paid to install the garden office and equipment, own it personally and claimed allowances correctly. But maybe something else and you haven't done everything correctly.

Whatever, OP (aiui) is talking about an employer buying equipment and making it available to an employee. The default position, whatever the employee uses the equipment for, is that this is a BIK. Very very many things that would be BIKs are in fact unBIKked by exemptions.

In short, exemptions are good; business-only use won't of itself stop a BIK - indeed is irrelevant, unless that is a condition of the specific exemption in point.

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DougScott
By Dougscott
29th May 2024 11:20

Just tell him in an email that you will put it through as a business expense as he has said it is for business use but if HMRC ever ask (highly unlikely of course) it is him who will have to make that argument to them.

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Replying to Dougscott:
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By Tax Dragon
29th May 2024 11:32

Will he? What exemption are you thinking of that has this as a test?

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Replying to Tax Dragon:
DougScott
By Dougscott
29th May 2024 15:17

Oh I see the OP is an employee of the director's company - my bad.

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By FactChecker
29th May 2024 11:47

£150 "for a set of WiFi boosters for his home"?
That suggests a number (probably at least 4 or 5) of the boosters were purchased.
In which case, he's not only got a large home but (more importantly) his office-spaces are widely dispersed across the estate IF they're really for business use.

Personally I'd take this more as an indication that I should re-check all his other claims, than being particularly concerned if it's a one-off fuzzy try-on.

EDIT: fuzzy obviously applies to my reading skills this morning - I've only just noticed that OP is an employee (responsible for Payroll and BiKs by the sound of it), so this has nothing to do with accounting per se (just the 'BiK or not' angle).
In which case, there's always the other angle .. rejecting the expense claim (wholly or partially) as not meeting company rules regarding business expenses?

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By kim.shaw-and-co.com
30th May 2024 02:44

The answer is really likely very simple

- Has ownership passed to the employer on account of the cost of purchase of the boosters being claimed back ?

Presumably so, and therefore there may be private use of company assets (whether they are capitalized in the accounts or not - there is strictly no 'de minimis' for the value of an asset even when it has been expensed in full in the year of acquisition)

The best place to look is likely here which explains how to treat the assets from the perspective of BIKs where there is any potential for private use :

https://www.gov.uk/hmrc-internal-manuals/employment-income-manual/eim21611

See in particular comments relating to the extent of private use in relation to disregards, and the consequences of transfer of ownership back to a director (whether it has been written down or never 'capitalized' in the company accounts or not).

From this you should be able to construct your own narrative in support of the fact pattern to support the tax treatment applied, which the directors can be asked to confirm. If you use Cloud accounting, attach a copy of relevant email(s) to the purchase invoice entry and/or write the explanations in comments so you don't have to think about it again in the event of a Compliance Check.

PS : there's a nice little article on all this sort of thing here :

https://www.taxinsider.co.uk/private-use-of-employer-business-assets-a-s...

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