Research shows a lack of understanding amongst employees on the taxation of benefits in kind
01 July 2019
Research exploring the incidence and nature of non-taxable benefits in kind received by employees in the UK has been published on GOV.UK, revealing that just over a third of employees knew that benefits and perks provided by employers were sometimes subject to income tax and National Insurance contributions.
The research was commissioned by HMRC with the key aims being to:
- quantify the number of employees receiving different non-taxable BiKs;
- explore if there are differences in the incidence of non-taxable BiKs, based on various sectoral and individual factors; and
- gather an understanding of the value employees put on BiKs, how remuneration packages are agreed between employers and how well employees understand the rules behind the taxation of BiKs.
The research involved 1,528 interviews with employees across all key sectors in the UK.
The research also revealed that the majority of employees were offered at least one non-taxable BiK by their employer but there were clear variations by sector with a much greater proportion of employees in ‘white collar’ sectors being offered, and accepting, benefits.
The research shows that the five most commonly used non-taxable BiKs were:
- an annual party
- free or discounted products or services for staff
- mobile phone
- parking
- free or subsidised meals
You can read the full report on GOV.UK
