In this section:

  • Expenses and benefits A to Z

Computers loaned to an employee

This guide tells you what the reporting, tax and National Insurance contributions (NICs) requirements are if you provide an employee with a computer.

On this page:

Business-use only

Definitions or restrictions

You provide an employee with a computer and both of the following conditions apply:

  • your only reason for providing the computer is so the employee can use it for business purposes
  • if the employee uses it privately as well, the private use isn’t significant

What to report, what to pay

You have:

  • no reporting requirements
  • no tax or NICs to pay

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Private use also

Definitions or restrictions

You provide an employee with a computer either wholly or partly for private purposes.

What to report, what to pay

For employees earning at a rate of less than £8,500 per year, you have:

  • no reporting requirements
  • no tax or NICs to pay

For company directors or employees earning at a rate of £8,500 or more per year:

  • report on form P11D - section L
  • pay Class 1A NICs on the value of the benefit


Work out the value to use

The value to use is calculated as follows:

  • 20 per cent of the computer's market value (when you first provided it as a benefit) or of any rental/hire charge you pay for it - whichever is higher
  • plus any running costs you cover
  • less any amount made good by your employee

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Computers provided before 6 April 2006

Different rules were in place for 2005-06 and previous tax years. These rules continue to apply if you still provide a particular computer to an employee under an arrangement that you entered into before 6 April 2006. Follow the link below for detailed guidance.

EIM21699: Computers - partial exemption

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Understanding the £8,500 threshold

To check what's included in the £8,500 threshold for P11D reporting purposes, follow the link below.

End-of-year forms at a glance

Technical guidance

EIM21631: cash equivalent of assets placed at the disposal of a director or employee

EIM21613: meaning of 'not significant' use for private purposes