Taxable: Quidco & Topcashback for business expenses
Discussion
I have been travelling a lot on business recently and booking hotels using Quidco and Expedia.
I've just received a fairly substantial bank credit from Quidco.
My employer isn't really interested in this money.
I've googled this type of cashback and it seems that HMRC view it as a non-taxable discount. This seems wrong to me as I'm receiving the money as a 'discount' on expenditure that effectively I've never made.
Does anyone have solid information on this?
To give context, the amounts are between 9 and 12% of some pricey hotels.
The hotel costs were identical whether I went through quidco or not.
I've just received a fairly substantial bank credit from Quidco.
My employer isn't really interested in this money.
I've googled this type of cashback and it seems that HMRC view it as a non-taxable discount. This seems wrong to me as I'm receiving the money as a 'discount' on expenditure that effectively I've never made.
Does anyone have solid information on this?
To give context, the amounts are between 9 and 12% of some pricey hotels.
The hotel costs were identical whether I went through quidco or not.
Eric Mc said:
There is nothing to stop you paying tax voluntarily - if you want to.
HMRC generally ignores trade discounts/regards/points on cards etc .
There are still many staff related perks - such as cheap airline travel of airline employees - that fall outside of the tax system.
Thanks, that's good to know.HMRC generally ignores trade discounts/regards/points on cards etc .
There are still many staff related perks - such as cheap airline travel of airline employees - that fall outside of the tax system.
It just seems strange to have been given a sum adjacent to 15% of my salary, tax free.
I'll stop worrying about it.
More travel later this year - happy days.
From HMRC's own internal manual -
Particular benefits: air miles, credit card points etc
In general, air miles, petrol tokens, credit card points etc. acquired by an employee are not taxable if they were acquired in the same way as applies to any other member of the general public, for instance by buying goods or services on which such benefits are given,
Provided the vouchers, air miles or points belong to the employee rather than the employer, they are not considered as being provided by reason of their employment even if the goods or services giving rise to them happen to be purchased as part of the employee’s business travel or using a credit card provided by the employer.
Using the example of air miles, the benefit of the award of additional air miles will not be considered to be provided by reason of the employment even if the employee concerned only has the opportunity to be awarded those particular air miles because they’re going on a business journey for which the costs are met or reimbursed by the employer. But this is subject to the condition that the air miles are awarded to the employee from the outset in just the same way that the provider would award them to any other customer buying the same ticket or product.
In those circumstances, there is no need for the employer - or indeed the third party supplier of the air miles or reward/ profile points - to report these items to HMRC, or for the employee in question to enter them on a tax return if he or she gets one,
However, there is a tax charge on such items, if they are provided by reason of the employee’s employment.
This would be the case if the fact of the employment was a necessary antecedent condition to the receipt of air miles. An example of this would be where the employer purchased a block of air miles and distributed them to the employees, perhaps as part of an incentive scheme. Another example would be where there’s an arrangement for a third party to provide petrol tokens or some other form of award points specifically to employees of a particular employer but not to other customers.
It is important to remember that the exact tax treatment will depend on the facts of a particular case.
Particular benefits: air miles, credit card points etc
In general, air miles, petrol tokens, credit card points etc. acquired by an employee are not taxable if they were acquired in the same way as applies to any other member of the general public, for instance by buying goods or services on which such benefits are given,
Provided the vouchers, air miles or points belong to the employee rather than the employer, they are not considered as being provided by reason of their employment even if the goods or services giving rise to them happen to be purchased as part of the employee’s business travel or using a credit card provided by the employer.
Using the example of air miles, the benefit of the award of additional air miles will not be considered to be provided by reason of the employment even if the employee concerned only has the opportunity to be awarded those particular air miles because they’re going on a business journey for which the costs are met or reimbursed by the employer. But this is subject to the condition that the air miles are awarded to the employee from the outset in just the same way that the provider would award them to any other customer buying the same ticket or product.
In those circumstances, there is no need for the employer - or indeed the third party supplier of the air miles or reward/ profile points - to report these items to HMRC, or for the employee in question to enter them on a tax return if he or she gets one,
However, there is a tax charge on such items, if they are provided by reason of the employee’s employment.
This would be the case if the fact of the employment was a necessary antecedent condition to the receipt of air miles. An example of this would be where the employer purchased a block of air miles and distributed them to the employees, perhaps as part of an incentive scheme. Another example would be where there’s an arrangement for a third party to provide petrol tokens or some other form of award points specifically to employees of a particular employer but not to other customers.
It is important to remember that the exact tax treatment will depend on the facts of a particular case.
rockin said:
nyt said:
My employer isn't really interested in this money.
Be careful. If your employer decided it actually was "interested" it's an easy way to get fired or even a criminal record. It's high risk to pocket any benefit in cash unless it's definitely permitted. Eric Mc said:
15% of gross salary does seem a tad excessive, I have to say. Most staff discounts are fairly minor.
Some hotels were very expensive. The cashback soon mounts up - 10% of business quality hotels sometimes 7 days a week.I meant 15% of my take home salary if I wasn't clear.
I had to call a guy into my office once who was booking flights directly and not via the travel company as he could get extra perks, this was contrary to the expenses policy where circumventing the agency was only permitted in exceptional circumstances. I don't think he's forgiven me for bouncing his flight to the US which offered a free upgrade on Concord one way, but then it was £1500 more than the agency price.
If you're not obliged to use the companies preferred means of booking travel then fill your boots, but if you are, then if I was your employer I'd be having words. People often cite "I can get a better deal" which occasionally they can, but thats not the point.
You're also not asking for reimbursement of the amount you've paid which may be another slightly grey area if its cash back, cash back isn't quite the same as a token or air mile which has a cash value of 0.00001p, that said plenty use cash back credit cards and there's no particular issue (although again, some companies mandate the use of a company credit card where possible).
I'm on your side, I've had my share of free flights and hotel rooms thanks to my job, just pointing out areas you need to make sure you're not falling fowl of in your quest for some cash.
If you're not obliged to use the companies preferred means of booking travel then fill your boots, but if you are, then if I was your employer I'd be having words. People often cite "I can get a better deal" which occasionally they can, but thats not the point.
You're also not asking for reimbursement of the amount you've paid which may be another slightly grey area if its cash back, cash back isn't quite the same as a token or air mile which has a cash value of 0.00001p, that said plenty use cash back credit cards and there's no particular issue (although again, some companies mandate the use of a company credit card where possible).
I'm on your side, I've had my share of free flights and hotel rooms thanks to my job, just pointing out areas you need to make sure you're not falling fowl of in your quest for some cash.
Heres Johnny said:
I'm on your side, I've had my share of free flights and hotel rooms thanks to my job, just pointing out areas you need to make sure you're not falling fowl of in your quest for some cash.
To be clear I wasn't on a quest for free cash or to avoid tax. It just kind of happened. I made my employer aware and was just concerned that there would be a tax liability. My employer isn't big enough to have a travel department (or a travel policy really) and is grateful that we do our own booking.
As I said above, they are aware of the cashback and look on it as offsetting the weekend travel and periods away from home. Employer has claimed the full cost from the end client months ago (Quidco payouts take over 6 months) so is not out of pocket.
nyt said:
To be clear I wasn't on a quest for free cash or to avoid tax. It just kind of happened. I made my employer aware and was just concerned that there would be a tax liability.
My employer isn't big enough to have a travel department (or a travel policy really) and is grateful that we do our own booking.
As I said above, they are aware of the cashback and look on it as offsetting the weekend travel and periods away from home. Employer has claimed the full cost from the end client months ago (Quidco payouts take over 6 months) so is not out of pocket.
You know, if you whinge to their online chat that it's taking too long they'll pay you immediately. My employer isn't big enough to have a travel department (or a travel policy really) and is grateful that we do our own booking.
As I said above, they are aware of the cashback and look on it as offsetting the weekend travel and periods away from home. Employer has claimed the full cost from the end client months ago (Quidco payouts take over 6 months) so is not out of pocket.
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