Consultations on simplifying employee benefits in kind regime

The government has launched four consultations on proposed changes to simplify the administration of employee benefits in kind and expenses and is also seeking views on remuneration packages in the 21st century, in a bid to cut the administrative burden for employers

The consultations follow a review carried out by the Office of Tax Simplification (OTS) announced in this year’s Budget. One consultation will look at abolishing the £8,500 threshold for benefits in kind, which the OTS identified as adding unnecessary complexity to the tax system. The review will consider any actions required to mitigate the impacts on vulnerable groups affected by the changes.

There will also be two consultations on proposals to make it easier and simpler for employers to administer employee benefits systems. One will look at introducing a statutory definition of a trivial benefit in kind, while the second will examine options for voluntary payrolling of benefits in kind instead of submitting forms P11D. A separate consultation will examine how to replace the current system of dispensations for reporting non-taxable expenses with an exemption for expenses paid or reimbursed by employers.

As well as consulting on simplifying the tax treatment of employee benefits and expenses, the government is publishing a call for evidence on remuneration packages, with the aim of exploring the factors behind current changes in practice and the likely future trends. The government has also stated that there will be a review of the tax treatment of travel and subsistence payments in due course.

David Gauke, Exchequer Secretary to the Treasury, said: ‘Following the valuable work the Office of Tax Simplification has carried out in reviewing employee benefits and expenses, the government is now consulting on changes that will deliver real improvements for businesses and individual and their experience of the tax system. We want to make sure we get the structure and detail absolutely right and each consultation will allow us to engage with and learn from those who will be directly affected.’

The consultations will close on 9 September 2014 and there is more detail here:


Pat Sweet |Reporter, Accountancy Daily [2010-2021]

Pat Sweet was the former online reporter at Accountancy Daily and contributor to the monthly Accountancy magazine, pub...

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