Benefits-in-kind regime ‘not fit for purpose’
The Institute of Chartered Accountants in England and Wales (ICAEW) has suggested that the current benefits-in-kind (BiK) system is ‘not fit for purpose’ for a post-coronavirus (COVID-19) world.
Taking into account the ‘new normal’; the ICAEW said that the BiK tax legislation is no longer fit for purpose ‘in light of the likely increase in employees working from home’.
Furthermore, The ICAEW stated that responsible employers are likely to permit their employees to choose whether they work from home or in the office. Recommending that employee choice should not be detrimental to the deductibility of expenses incurred by homeworkers.
The ICAEW’s Tax Faculty has submitted a series of recommendations to HMRC, outlining improvements to the employee BiK and expenses regime in light of the COVID-19 pandemic.
The Institute stated that the benefits-in-kind regime needs to ‘adapt to accommodate changes in working practices arising from the COVID-19 lockdown’, including the introduction of social distancing measures.
Further information can be found here.
Do you need assistance with your accounts? Talk to our team today