Income Tax - Employment Flashcards
Employment Income?
What do we focus on Employment Income?
CASH BENEFITS
Salary xxxx
Deduct occupational pension scheme (xxx)
ADD NON CASH BENEFITS
Accommodation xxx
Car benefits xxx
LESS ALLOWABLE DEDUCTIONS
Qualifying expenses like travel (xxx)
Subscriptions to professional body’s (xxx)
Total Employment Income ——xxxx
Additional
Accommodation - Annual value OR rent whichever is highest. ( 3% above 75k for additional benefits ) SHOULD not be included for teachers and people. Deduct any amounts paid by them for accommodation!
Ancillary benefits - Like light, heat and etc. Restricted up to 10% of total Cash and Non cash 👍!
Car benefits and fuel benefits - Additional accessories should be included except for phone and disabled stuff. ADD 3% For diesel. Rates / 99-95 is 16%. Rates 75-94 is 15%. Every increase above 99 is 5 per gram.
ASSETS for private use -
Choose which ever is greater.
1. current market value less price paid by employee.
2. first market value - already taxed benefit - price paid by the employee.
Beneficial loans.
Authorizes mileage rate 10k at 45p and above for 25p. Motor vehicle 24p and pedal cycle 20p. ( In this deduct mileage allowance from reimbursement for lower tax 👍 ) . Cheap loan calculation using average and strict method!
For accommodation what value do we take? Is there any additional cost?
Annual value or rent whichever, is HIGHEST.
YES if it is above 75k with the rate of 3%.
Ancillary benefits is limited up to what?
ONLY 10% of the TOTAL cash and non cash benefits!
How should car benefits be calculated?
Base figure of 22,200 times 16% for CO2 emission of 99-95 and 15% for CO2 emission of 94-75. REMEMBER to add 3% for Diesel!
Assets for private use?
Choose which ever is greater.
- current market value less price paid by employee.
2. first market value - already taxed benefit - price paid by the employee.
Authorized mileage allowance?
How do we deduct it?
45p and 25p above 10,000 miles and 40p for motorcycle while charging 20p for pedal cycles.
Just deduct the millage allowance from the actual amount employee took for petrol.
How are cheap loans (beneficial loans) calculated?
Using the strict method OR average method.0
