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Pensions and tax

Benefits in kind

Benefits which you receive from your employer that are not paid as money may be taxable.

Benefits in kind is a broad term that covers other benefits with a financial value that you may receive from your employer, that are not paid to you as cash. Some benefits in kind are taxable, others aren’t.

Various terms and conditions apply to benefits in kind to determine whether they are taxable or not, so you should check to see what your liability may be for each benefit in kind that you receive. You can find out more on HMRC’s website here.

If you do receive taxable benefits in kind, the taxable value of these is counted as part of your earnings to determine how much you can pay as pension contributions in a tax year, and still receive tax relief.

The most common taxable benefits in kind that employers may provide you

  • Company cars
  • Fuel for non-business use
  • Health and medical insurance
  • Payments for childcare
  • Credit vouchers and transport vouchers
  • Employer provided living accommodation
  • Payment of the employee’s personal liabilities

 

Examples of non-taxable benefits

  • Employer payments to pension schemes
  • Workplace nurseries and crèches
  • Staff canteen and dining facilities
  • Medical check-ups, eye tests and corrective glasses
  • Pool cars
  • Education and training
  • Travel costs which are incurred in the course of the employer’s business
  • Season ticket loans, cheap loans and interest free-loans of less than £10,000.

 

Frequently asked...

Where can I find out more?

If you need more information, please contact us. A pension specialist from our team will be happy to help with any question you might have. Our help is always free. 

Where can I find out more?

If you need more information, please contact us. A pension specialist from our team will be happy to help with whatever pensions-related question you have. Our help is always free.

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