One of my clients (Limited co.) has an employee who is using her own laptop when she is at work. The client asked me today if she could pay the employee an allowance for using her laptop for work purposes. Is this ok and if so are there any tax implications for the employee or my client? She was thinking of paying her a one off sum rather than a set amount each month.
Any and all advice gratefully received as usual. Not come across this scenario before.
The HMRC would treat it as a Benefit in Kind! The allowance would be treated as taxable income. "Duality of purpose" comes into mind. The employee already had the laptop so is not out of pocket using it for work purposes.
My suggestion is perhap the employer should pay for employees virus software instead. I would suggest getting some business virus software, better than the type the employee would pay fo herself.
The software would be to protect the business related work, so the private use protection would be "incidental" to the business reason for having the software paid for by the employer.