As ‘lock-down’ is gradually eased, more and more businesses are looking to reopen and employees are returning to work.
The current advice is still to work from home unless you are unable to do so. However there are a few tax savings available to employers and employees as we all take the practical steps necessary to return to the workplace.
As use of public transport and car sharing is currently discouraged, travel to work arrangements may be changing.
Thinking about cycling?
- Consider the cycle to work Scheme – a tax efficient way to buy yourself a new bike and all the related equipment.
- In the first instance, speak to your employer – if they don’t already operate the scheme it’s easy to set up.
- If you are self-employed, and pay yourself a salary through your own limited company, this scheme is also available to you.
- For detailed information visit https://www.cyclescheme.co.uk/
- If you are an employer who needs help setting up or administering the scheme, contact your payroll administrator in the first instance.
Need a new car? Consider ‘going electric’
A fully electric vehicle is currently a great company car option
- Purchasing an electric vehicle through a limited company will give 100% tax relief. This will reduce the corporation tax liability in the year of purchase.
- It won’t be a treated as a taxable benefit for the 2020/21 tax year (tax rising to 1% in 2021/22 and 2% in 2022/23)
- Don’t forget, there’s also reduced road tax on electric vehicles
Still working from home?
If your usual workplace was or remains closed
- You can claim a £6/week tax allowance to cover increased household costs of working from home
- If you usually complete a self assessment tax return, you can claim on your next return
- Otherwise, click here to claim https://www.gov.uk/tax-relief-for-employees/working-at-home
- You can claim higher amounts, but will require detailed evidence to support these claims.
Employers – have you reimbursed any employees for computer equipment, internet access or furniture to enable them to work from home during the pandemic?
If so, no tax or NI will be payable on this as part of a year long exemption.
If you’d like to talk through any of these points about returning to work, or getting your business up-and-running again, please get in touch with the team at Wessex Commercial.