In some cases you may be asked by an employer to treat a benefit
as exempt from tax, on the grounds that the cash equivalent
(Section 203(1) ITEPA 2003) of the benefit taxable on the employee
(or on each of the employees concerned if there is more than one of
them) is so trivial as to be not worth pursuing. This is sometimes
referred to as 'de minimis' grounds.
There is no general statutory limit below which benefits are
not taxable. However that
does not mean that you should insist that every
trivial benefit should be included on a form P11D or included in a
PAYE Settlement Agreement (PSA), irrespective of the administrative
burdens on both the employer and the Inland Revenue in handling
P11Ds and PSAs.
When considering requests use common sense, bearing in mind
the guidance at
EIM21861. Strike a balance between
sensible practical administration of the tax system and the need to
deter employers from providing what is in reality part of the
remuneration of their employees in a form that seeks to exploit
that practical administration.
Do not discriminate against large employers by
seeking tax in circumstances where you would not if only a few
employees were involved.
See
EIM21862 for what to do if you agree to
the employer's request.
