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Post Info TOPIC: Bursaries to employees' children
katebrown


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Bursaries to employees' children
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Morning all - I wonder if anyone can help with this please?

I have a client who is planning to pay bursaries to his children who are at university. These will be available to the children of all employees. There are two things I need to find out:

1. Are the bursaries taxable income for the children, or a chargeable benefit for the parent? Just trying to establish if there's anything that needs reporting or any tax/NI.

2. Are there any procedures/paperwork that the client should be completing in order to keep HMRC (or anyone else) happy? A letter to all employees explaining the scheme, for example?

Many thanks!

Kate



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RedTapeDoc


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This might be some help

A bursary can only be made to a full-time student to meet their ordinary living costs whilst studying.

To be tax-free its essential that:

  • The purpose of study must be for the student's personal benefit and academic development (not for the benefit of the employer or sponsor).
  • The payment must be in the nature of a subsistence allowance, and modest in scale.
  • That student must not be providing any services that would benefits to the employer or sponsor. 


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katebrown


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Sorry, I've only just seen your reply - many thanks for your help.

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