IPSE Membership on P11D

[eek]

Possibly, but if so it's not clear.

The wording is:

"Any payments made to IPSE (formerly the PCG) by YourCo for your own personal subscription should be treated as private and allocated as amounts payable to employee. If the amount is included as a company expense then it will be a taxable benefit and should be included below."

I have emailed them to confirm.

Isn't it easier just to buy membership from your own personal money. Assuming your company is on flat rate VAT the actual difference in cost will be utterly minimal...

[malvolio]

Possibly, but if so it's not clear.

The wording is:

"Any payments made to IPSE (formerly the PCG) by YourCo for your own personal subscription should be treated as private and allocated as amounts payable to employee. If the amount is included as a company expense then it will be a taxable benefit and should be included below."

I have emailed them to confirm.

Asked who - your accountant or IPSE?

IPSE's advice is that you wouldn't want IPSE membership if you didn't have a company and therefore the risks of IR35 and all the other stuff it covers. Therefore the subs are wholly and exclusively business-related and so cannot be treated as a BIK since there is no possible personal benefit.

The thing about no CT allowance is separate and is about IPSE not being a Professional Body (in the same sense that people like IET are). To become one would mean handing over IPSE's membership details to HMRC which, for some reason, they are unwilling to do. Therefore the fees are not deductible against CT as a result of an early Trade Union case from around 1910 which still stands as case law.

And that has been the case since PCG kicked off, and was confirmed, in excruciating detail,in 2006 or so.

[mudskipper]

Asked who - your accountant or IPSE?

IPSE's advice is that you wouldn't want IPSE membership if you didn't have a company and therefore the risks of IR35 and all the other stuff it covers. Therefore the subs are wholly and exclusively business-related and so cannot be treated as a BIK since there is no possible personal benefit.

The thing about no CT allowance is separate and is about IPSE not being a Professional Body (in the same sense that people like IET are). To become one would mean handing over IPSE's membership details to HMRC which, for some reason, they are unwilling to do. Therefore the fees are not deductible against CT as a result of an early Trade Union case from around 1910 which still stands as case law.

And that has been the case since PCG kicked off, and was confirmed, in excruciating detail,in 2006 or so.

I've asked the accountant.

Eek, I paid through myCo because I always have. The difference is surely 40% tax or 20% tax, although, as you say, it's not a huge some of money. Depending on the answer from the accountant I may change it next year to keep it simple.

The reasons why its not exempt from corp tax are explained on the FAQ page I linked to earlier - I don't have a problem with this, just want to keep my accounting practices squeaky clean.

[borderreiver]

IPSE's advice is that you wouldn't want IPSE membership if you didn't have a company and therefore the risks of IR35 and all the other stuff it covers. Therefore the subs are wholly and exclusively business-related and so cannot be treated as a BIK since there is no possible personal benefit.

FWIW, that was my accountant's opinion as well.

[jamesbrown]

IPSE's advice is that you wouldn't want IPSE membership if you didn't have a company and therefore the risks of IR35 and all the other stuff it covers.

Unless you've recently closed the company and want ongoing cover for a year or so.

Also, I don't necessarily agree. For example, IPSE offers life assurance and this could involve a personal BIK, depending on the total amount insured. Thus, I'd guess that mudskipper's accountant is asking, specifically, whether any payments to IPSE might involve a BIK, but they are doing so in a convoluted way that would require clarification. Alternatively, they've misunderstood the situation.

[Contreras]

You may as well pay for this out of your own pocket.

Isn't it easier just to buy membership from your own personal money. Assuming your company is on flat rate VAT the actual difference in cost will be utterly minimal...

No because it increases the amount that can be extracted from the company before touching the high rate band. Same as for "client entertainment."

Another thing is that the IPSE opinion is just that. Opinions differ and some accountants will deduct it against CT.

IMHO, the difference is so marginal that it's not worth getting too bothered about. But if I were a member I'd be interested to see the 'official' opinion updated/reaffirmed as IPSE+ benefits have moved on somewhat since.

[malvolio]

Unless you've recently closed the company and want ongoing cover for a year or so.

You only need the cover for the tax year after you close the company. No reason not to pay for that year in advance. If you need it after that point it's only because HMRC won't let you close the company in which case you're back to the status quo ante...

Also, I don't necessarily agree. For example, IPSE offers life assurance and this could involve a personal BIK, depending on the total amount insured. Thus, I'd guess that mudskipper's accountant is asking, specifically, whether any payments to IPSE might involve a BIK, but they are doing so in a convoluted way that would require clarification. Alternatively, they've misunderstood the situation.

IPSE doesn't' offer life insurance, it offers discounted access to a group life insurance scheme. But apart from that, you're right, if you pay a LA premium through YourCo it should be declared, as should health care and other related stuff. Just like any employee receiving BIK services from their employer.

But the membership fee is not a BIK, never has been, never will be.

[eek]

No because it increases the amount that can be extracted from the company before touching the high rate band. Same as for "client entertainment."

Another thing is that the IPSE opinion is just that. Opinions differ and some accountants will deduct it against CT.

IMHO, the difference is so marginal that it's not worth getting too bothered about. But if I were a member I'd be interested to see the 'official' opinion updated/reaffirmed as IPSE+ benefits have moved on somewhat since.

It depends. If your other half doesn't work its possible to extract an awful lot out of the company every year without hitting higher rate tax...

[mudskipper]

It depends. If your other half doesn't work its possible to extract an awful lot out of the company every year without hitting higher rate tax...

But it still increases that amount.

[jamesbrown]

IPSE doesn't' offer life insurance, it offers discounted access to a group life insurance scheme.

On the contrary:

https://www.ipse.co.uk/futures/ipse-life-assurance

It even talks about the potential BIK issue.