Treating tax free income earned in HSMP

[Chris]

Anyone have any idea about the tax free income being treated as part of the income in UK.

My gross is 30K which comes to £2500 per month.

I pay rent of £500 which is not taxable, so my pay slip reflects £2500 - £500(rent paid) so taxabale income is shown as £2000. I dont know how my company accountant does this. Though my gross is 30K but my taxable income is 24K.

So would my gross income be treated as 30K or 24K.

Chris.

[Amit T]

Chris,

If you can producec an evidance - employer statement etc - to support the payment of the same, it should b considered as part of your income. If it is so your income will b considered as 30K.

Hope this helps.

[Chris]

Yes my pay slip clearly mentions this details per month

Total pay 2500
Less Rent 500

Total tax xxxx

Net income xxxx
Total taxable income till date(for current year) 22xxx

The total taxable income mentions £24000 thats where the problem is. In my knowledge the total taxable income is what is considered, which in my case is 24K.

Please correct me if I am wrong.

Cheers,
Chris.

[John]

Chris, I suspect that care needs to be taken here.

One interpretation of the facts you mention is that you are paid £2K per month and given the right to occupy some accommodation rent-free. However it is totally possible that that right to occupy the property will be deemed to be a taxable benefit, unless certain specific exemptions apply.

Do you get a form P11D? If so, does it mention anything about any accommodation benefit?

[Rex]

Get a letter from employer mentioning your dates of employment and Gross Annual Salary 30k. That must solve this issue.

[Chris]

Well, I dont know how do they do that.

Basically I am an employee workin in Indian company transferred to UK office. when I asked my accountant about this rent not taxable he said the first 2 years all the empoyee in our company gets that benefit. After that this benefit does not continue.

This is the only detail I know about the rent issue. Otherwise my offer letter mentions my gross salary as 30K with bonus of 2K per annum.

Hope this would make thing more clear.

Chris.

[Yogi2006]

Chris, I suspect that care needs to be taken here.

One interpretation of the facts you mention is that you are paid £2K per month and given the right to occupy some accommodation rent-free. However it is totally possible that that right to occupy the property will be deemed to be a taxable benefit, unless certain specific exemptions apply.

Do you get a form P11D? If so, does it mention anything about any accommodation benefit?

John
What u are mentioning is living accomodation benefit and is taxable hence chris needs to give P11 anyway otherwise its a problem
What I want to ask you is does that mean that benefits declared on P11 are consdered as eranings for hsmp extension?

Regards
Yogesh