The Chancellor’s Budget 2006
http://www.pwc.com/uk/budget/2006/pw...ty_Summary.pdf
VDU users: eye tests and glasses not a taxable benefit.
http://www.pwc.com/uk/budget/2006/pw...ty_Summary.pdf
VDU users: eye tests and glasses not a taxable benefit.
Employers are required by law to meet the cost of eye care tests and/ or corrective glasses for VDU use for their employees and, where they do so, no benefit in kind charge normally arises. However, strictly the exemption applies only to employers meeting these costs directly, and not where they are either reimbursed to the employees, or where the employees are provided with a voucher to pay for the glasses or eye test.
This anomaly is to be corrected, so that, regardless of how the arrangements for the provision are structured, the provision of glasses and eye care for VDU users will not be a taxable benefit. As a practical point, employers will be able to let their employees make their own eye-care arrangements, and simply reimburse the cost, which will allow greater flexibility and employee choice, and may also save administrative costs for the employer.
There is nothing to suggest that the legislation will be retrospective in effect; however, in practice HMRC does not appear to have pursued actively any liabilities arising because of the way in which these arrangements were
structured, so the change itself is unlikely to be of great consequence.
In addition, the measure provides HMRC with a new power to make regulations to exempt similar benefits in kind from a tax charge that would otherwise apply because they are being provided by means of a non-cash
voucher
This anomaly is to be corrected, so that, regardless of how the arrangements for the provision are structured, the provision of glasses and eye care for VDU users will not be a taxable benefit. As a practical point, employers will be able to let their employees make their own eye-care arrangements, and simply reimburse the cost, which will allow greater flexibility and employee choice, and may also save administrative costs for the employer.
There is nothing to suggest that the legislation will be retrospective in effect; however, in practice HMRC does not appear to have pursued actively any liabilities arising because of the way in which these arrangements were
structured, so the change itself is unlikely to be of great consequence.
In addition, the measure provides HMRC with a new power to make regulations to exempt similar benefits in kind from a tax charge that would otherwise apply because they are being provided by means of a non-cash
voucher
Comment