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Focus Groups

Stud Farms – Benefits in Kind

The following are examples of benefits in kind which, in our experience, exist on the majority of stud farms where they employ staff:

1. Job-related Accommodation

Accommodation provided to employees under normal rules is taxable on the employee. However, to be considered as job-related accommodation and considered as non-taxable, either of the following conditions must apply:

a. The Accommodation must be considered as being ‘customary’ within the industry. As far as we are aware this has to date not been agreed with HM Revenue & Customs.

Or

b. The Accommodation provided is for the ‘better or proper performance’ of the employee’s duties.

Normally HM Revenue & Customs will accept that job related accommodation applies within the industry.

If the employer pays the bills relating to the property without being reimbursed, the following treatments will apply:

a. Electric, Gas & Oil – these are all chargeable as a benefit in kind.
b. Rates & Water – normally not chargeable as a benefit in kind.
c. Repairs & Maintenance – normally not chargeable if maintaining the property.
d. Provision of a Cleaner – chargeable as a benefit in kind.

2. Van Benefit

From 6 April 2007 the amount of benefit normally assessable on the employee was increased from £500 to £3,000. However, providing the employer is able to demonstrate there is insignificant private usage, no benefit will become assessable. Additionally, where an employee has unrestricted private use of a van and receives free fuel, an additional fuel scale charge of £500 applies.