Reply to: Oyster travel card question - again

[Optimus Prime]

Well done for making it as far as half-way through my first sentence before hitting "reply".

I do not see your point over there. Is there one?

[Optimus Prime]

I do PAYG and just deduct any personal trips. I hope that will be OK !

That certainly is.

[d000hg]

Why is that crazy? The cheapest choice should be the obvious choice. Did you see the quote and links by SueEllen? Looks like it is crystal clear that it is fine to use it this way.

Well done for making it as far as half-way through my first sentence before hitting "reply".

[oversteer]

I do PAYG and just deduct any personal trips. I hope that will be OK !

[Optimus Prime]

WHS. If you for example expense a journey for a business meeting and meet up with a friend whilst you're there, you're supposed to apportion the cost of personal use as a BIK. Not sure whether anyone would actually do this.

Not if you have a travel card and it isn't costing the company extra. See links in SueEllen's post.

[Optimus Prime]

This may be okay within specific BIK guidelines for Oyster cards, but from a general point of view you cannot assume that because it is "free", there is no BIK.

Well yes, for the time being my thoughts are specifically for Oyster card usage.

[mudskipper]

WHS. If you for example expense a journey for a business meeting and meet up with a friend whilst you're there, you're supposed to apportion the cost of personal use as a BIK. Not sure whether anyone would actually do this.

[centurian]

It does seem crazy that you chose the cheapest option and then the fact that coincidentally you can use it personally FOR FREE means there is a taxable cost.

This may be okay within specific BIK guidelines for Oyster cards, but from a general point of view you cannot assume that because it is "free", there is no BIK. If you are deriving personal benefit from a company asset, that is a BIK - regardless of whether the personal usage of that asset causes the company any additional cost or not.

Try to look at it as if it is not your company. If you work for a large consultancy and they provide you with a company car for business use - it's quite common nowadays for company cars to be leased with all costs packaged in. The company say you can use the car for personal use, as long as you pay for the fuel - and the mileage doesn't cause them to go over the limit specified in the lease.

It hasn't cost the company a penny more, but you will still incur a significant BIK.

[Optimus Prime]

It does seem crazy that you chose the cheapest option and then the fact that coincidentally you can use it personally FOR FREE means there is a taxable cost.

IF that is the case and they did investigate you, I assume HMRC would have the power to get your travel records though.

Why is that crazy? The cheapest choice should be the obvious choice. Did you see the quote and links by SueEllen? Looks like it is crystal clear that it is fine to use it this way.

[d000hg]

It does seem crazy that you chose the cheapest option and then the fact that coincidentally you can use it personally FOR FREE means there is a taxable cost.

IF that is the case and they did investigate you, I assume HMRC would have the power to get your travel records though.

[Optimus Prime]

However the way you are asking your question indicates you want to take the p*ss.

Oh dear. What part of my question indicates that?

[Optimus Prime]

The point is you cannot use company money for personal use without there being an associated BIK. If you haven't figured out that Your Co and You are two entirely differnt "persons" then you're doing something wrong.

I've figured that out. Gets thrown at anyone asking questions around here far too often.

Like I said, for the company it is the cheaper option. The benefit to me is incidental (though welcome). SueEllens links makes me believe there is no BIK to be declared here.

[Optimus Prime]

Conclusion it isn't a BIK as long as the cost of the business travel equals the cost of the travelcard/ or money on the oyster card.

Yes, those examples make sense. I am going with this conclusion. Thanks for the links.

[wim121]

I don't think this advice is correct. Wim121, do you have a link to say that HMRC are OK about personal use on a season ticket?

I believe a seaon ticket has to be declared on the P11D, so the value of personal use should be estimated.

Hopefully someone will have the definitive answer.

That's why I said this:

I assume you just pay one flat rate for the month and no extras for each trip?

Therefore, your travelling outside of work hours shouldnt matter. You paid for an unlimited card as an economic option for work, so extra trips arent a concern for HMRC if they dont entail further expense.

You can save the tickets from each work commute if you like, just in case you get audited. One would assume though your home address and client one, with the oyster receipt would suffice, but we all know HMRC are morons.

I never use oyster cards in london, so Im not up to date on all the price plans, I just buy an unlimited tube ticket when im there. Cheaper than purchasing multiple single fares.

So lets say I hypothetically buy a unlimited ticket for business use at £60. If I use it for personal use outside of those hours then the cost of the ticket still remains the same at £60, as Ive entailed no further expense. Since each trip isnt audited, then there is no problem.

Example 2 clarifys it quite well, if the multi ticket cost is cheaper than indvidual fares, it is of benefit to the employer/employee.

[SueEllen]

So in the most cautious case I can declare a BIK of 2/7 or 1/7 of the cost of the season card? Assuming that on some weekends I use it for personal travel. It would completely suck to not be able to expense anything at all.

I suggest you ask your accountant about the links I gave you. (I certainly did when I was in a similar situation.)

However the way you are asking your question indicates you want to take the p*ss.