Any Tax / Self Assessment Experts?
Discussion
Hi. If there are any self assessment gurus out there can you help me out. I get private medical care paid for by my employer which costs them £1200 a year, this is a benefit in kind. I've got my P60 through from my employer and they've added the cost of the BIK to my annual pay so I've paid the correct level of tax. This works out correctly.
When I do my self assessment, I put in the total pay for the year (as stated on my P60) and enter my BIK in the SA also. When I go to the final calculation it works out that I pay tax on the BIK again.
Do I enter 0 in the BIK box in my SA (as it's already been deducted) or do I subtract the BIK from my total pay for the year?
Does the tax office get a copy of my P60 and cross check it against my SA?
I just don't want to pay the tax twice. I've tried getting some sense out our payroll team and they are useless, told me to speak to the taxman, which is easier said then done to get any joy out of them!
Cheers!
When I do my self assessment, I put in the total pay for the year (as stated on my P60) and enter my BIK in the SA also. When I go to the final calculation it works out that I pay tax on the BIK again.
Do I enter 0 in the BIK box in my SA (as it's already been deducted) or do I subtract the BIK from my total pay for the year?
Does the tax office get a copy of my P60 and cross check it against my SA?
I just don't want to pay the tax twice. I've tried getting some sense out our payroll team and they are useless, told me to speak to the taxman, which is easier said then done to get any joy out of them!
Cheers!
A few years ago I queried with HMRC why medical benefit had disappeared from my coding notices and they told me it was my employer was now "payrolling the benefit".
The employer does send info in - if you look at your tax account the numbers should already be there. IIRC the self-assessment basically auto-fills and you only change it if it's wrong.
We've changed payroll software at work and it's now gone back to being separate and it's back on the coding notice for this year. Wish mine was £1200 - it's £10,500 for this year!
The employer does send info in - if you look at your tax account the numbers should already be there. IIRC the self-assessment basically auto-fills and you only change it if it's wrong.
We've changed payroll software at work and it's now gone back to being separate and it's back on the coding notice for this year. Wish mine was £1200 - it's £10,500 for this year!
Edited by Sheepshanks on Friday 30th April 14:55
RammyMP said:
Do I enter 0 in the BIK box in my SA (as it's already been deducted) or do I subtract the BIK from my total pay for the year?
Does the tax office get a copy of my P60 and cross check it against my SA?
I just don't want to pay the tax twice. I've tried getting some sense out our payroll team and they are useless, told me to speak to the taxman, which is easier said then done to get any joy out of them!
Cheers!
Yes. You put in your salary including the benefit and put 0 in the BIK box.Does the tax office get a copy of my P60 and cross check it against my SA?
I just don't want to pay the tax twice. I've tried getting some sense out our payroll team and they are useless, told me to speak to the taxman, which is easier said then done to get any joy out of them!
Cheers!
If the medical insurance was provided as a BIK you would get a P11D with that on it, and your P60 would just cover your actual salary.
CharlesElliott said:
Yes. You put in your salary including the benefit and put 0 in the BIK box.
If the medical insurance was provided as a BIK you would get a P11D with that on it, and your P60 would just cover your actual salary.
They don't give me a P11D, there's a box on my pay statement that itemising my BIK.If the medical insurance was provided as a BIK you would get a P11D with that on it, and your P60 would just cover your actual salary.
So in theory the tax man doesn't know I have any BIK as my P60 states the correct amount of tax for my pay plus the BIK.
The normal course of action for an employer is NOT to include the Benefit in Kind as part of your normal salary. In other words, it should NOT appear on your P60 in that form. There is a good reason for this. Benefits in Kind (with rare exceptions) are NOT subject to National Insurance. They are a tax matter only. If your employer is adding the value of the BIK on to your Gross Salary, you are inadvertently going to be charged Employee's NI on the value of your Gross Salary INCLUSIVE of the BIK. This is wrong.
What the employer is SUPPOSED to do is notify HMRC about the BIK by submitting a Form P11D showing the BIK for the PREVIOUS tax year. HMRC then issues a PAYE Coding Notice which REDUCES your personal tax allowance for the CURRENT tax year so that you pay the correct tax amount on the value of the Benefit in Kind you are receiving WITHOUT it affecting your NI contributions.
What the employer is SUPPOSED to do is notify HMRC about the BIK by submitting a Form P11D showing the BIK for the PREVIOUS tax year. HMRC then issues a PAYE Coding Notice which REDUCES your personal tax allowance for the CURRENT tax year so that you pay the correct tax amount on the value of the Benefit in Kind you are receiving WITHOUT it affecting your NI contributions.
Eric Mc said:
If your employer is adding the value of the BIK on to your Gross Salary, you are inadvertently going to be charged Employee's NI on the value of your Gross Salary INCLUSIVE of the BIK. This is wrong.
I wondered about that, but apparently the payroll systems figure it out.My P60 didn't include it though - I only earn £9K in salary from that company, so it would stand out. I still got the usual P11D.
The only difference that was apparent to me with payrolled benefit is Medical benefit didn't appear as a separate line on my coding notices.
Eric Mc said:
The normal course of action for an employer is NOT to include the Benefit in Kind as part of your normal salary. In other words, it should NOT appear on your P60 in that form. There is a good reason for this. Benefits in Kind (with rare exceptions) are NOT subject to National Insurance. They are a tax matter only. If your employer is adding the value of the BIK on to your Gross Salary, you are inadvertently going to be charged Employee's NI on the value of your Gross Salary INCLUSIVE of the BIK. This is wrong.
What the employer is SUPPOSED to do is notify HMRC about the BIK by submitting a Form P11D showing the BIK for the PREVIOUS tax year. HMRC then issues a PAYE Coding Notice which REDUCES your personal tax allowance for the CURRENT tax year so that you pay the correct tax amount on the value of the Benefit in Kind you are receiving WITHOUT it affecting your NI contributions.
In my (small sample) experience of large companies, this ceased to be normal about 10 years ago when flex benefits and similar were introduced, and payslips show adjustments to take into account which are subject to tax / NI. What the employer is SUPPOSED to do is notify HMRC about the BIK by submitting a Form P11D showing the BIK for the PREVIOUS tax year. HMRC then issues a PAYE Coding Notice which REDUCES your personal tax allowance for the CURRENT tax year so that you pay the correct tax amount on the value of the Benefit in Kind you are receiving WITHOUT it affecting your NI contributions.
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