Employees may benefit from being allowed to
use assets (for example cars or properties) which
are owned by the EBT. The fact that such benefits may give rise to
income tax charges and NICs liability is irrelevant for the
purposes of FA03/SCH24.
The same applies if the employees benefit by being allowed
use of part of the trust fund, for example by receiving a loan
which is interest-free or at less than the official rate of
interest. The fact that receipt of such beneficial loans may give
rise to income tax charges and NICs liability is irrelevant for the
purposes of FA03/SCH24.
The only benefits which are relevant for the purposes of
FA03/SCH24 are ‘qualifying benefits’. These are
benefits which involve the payment of money (not a loan) or the
transfer of ownership of an asset to employees, see
BIM44620.
| 1/2/2004 | Company contribution to EBT | £300,000 |
| 2/2/2004 | EBT buys cars which employees are allowed to use privately, cost | £300,000 |
| 2004/05 | Employees are subject to income tax and NICs on car benefit charges | £50,000 |
No qualifying benefits have been paid. The income tax and NICs
liability on car benefits does not arise from transferring
ownership of assets to employees.
No deduction is allowed for the period ended 31 December
2004.
