U-turn on tax treatment of coronavirus (COVID-19) tests

09 July 2020

Previously in its guidance on ‘How to treat certain expenses and benefits provided to employees during coronavirus (COVID-19)’, HMRC confirmed that coronavirus tests would be treated as a benefit in kind for tax purposes. This decision, however, seems to have changed, and the guidance now states that coronavirus tests are not treated as a benefit in kind for the purposes of tax.

If businesses employ healthcare workers and other eligible front-line staff who get a test through the government’s national testing programme, there is no tax due to be paid, and no requirement to report a benefit to HMRC. There is information on the national testing scheme in the essential workers: get a test today to check if you have coronavirus guide.

For employers providing testing kits to their employees, outside of the government’s national testing scheme, there will also be no Income Tax or Class 1A National Insurance (NI) contributions due, whether the kits are provided directly or purchased to be carried out by a third party.

Guidance on the topic will be updated in due course


The information in this article is accurate at the time of publication. For all the latest information, news and resources on how the COVID-19 pandemic is affecting payroll professions, visit our Coronavirus hub.