Without these tax exemptions the ATT revealed that an employer paying for an employee’s test would be providing a benefit equal to the cost of the test.
This can lead to income tax and/or national insurance costs for both the employee and employer – as well as unwelcome administration tasks for the employer.
Jeremy Coker, president of the ATT expressed that the government must extend the income tax and national insurance exemptions for employer-funded testing until at least 5 April 2022 given the ongoing pandemic.
He said: “There would be a real public benefit in encouraging employers to support such testing. Key workers in particular should not be hit by tax charges if their employer pays for them to be tested.
“In our Budget representation,4 we suggest the Government could go even further, and that there would be a public benefit in introducing a wider-ranging and enduring exception from taxable benefits for employers who fund employee-testing for any highly transmissible disease.”