A benefit in kind occurs when your company incurs costs or provides assets for the private use of the director or employee. Additional tax is payable personally and potential Class 1A National Insurance is payable by the company. For example, an expense which is not wholly and exclusively for the business and provides a perk/ benefit to the Director/ Employee.
‘Benefits in kind’ – commonly referred to as perks or fringe benefits – come in all shapes and sizes. They can range from specific financial benefits like loans, or personal benefits like health insurance, to company cars, or even assets that employees can enjoy for personal use – such as properties.