Taxable Benefit In Kind - Private Health Insurance

[clockwork67]

I know Private Health Insurance is classed as a benefit in kind and is taxable (usually through tax code adjustment) - But my girlfriends company based in Republic of Ireland couldn't pay her health insurance company directly so they shes pays it herself and they re-imburse her through her salary and it looks as though she pays tax (which is OK I think as it would just be claimed back by Inland Revunue anyway) but also it looks as though she is paying NI on it as well - which I think shouldn't be applied - am I right or should she be paying both tax and NI on a benefit in kind

[Kryten]

She should not be paying both, what she should do is not have the salary increased but instead submit it as expenses and then at the end of the year her P11D will show it as a benefit in kind and her tax code adjusted as needed.

[AdamBrunt]

What Kryten said.

Though, surprisingly, it sounds like her company let her choose her own insurance policy rather than making her join the company group one.

[craig1912]

If she is paying the premium herself and it is an individual policy then benefit in kind doesn't come into it. If the company are reimbursing her premiums through pay then both tax and NI will apply-to be fair the company should adjust the amount to cover both.

Not sure you can claim Private Medical Insurance premiums as an expense-
www.hmrc.gov.uk/guidance/480.pdf

Does seem a strange way to do it though as both the company and her would be better off if they set up a group scheme and paid the premiums direct.

[clockwork67]

If she is paying the premium herself and it is an individual policy then benefit in kind doesn't come into it. If the company are reimbursing her premiums through pay then both tax and NI will apply-to be fair the company should adjust the amount to cover both.

Not sure you can claim Private Medical Insurance premiums as an expense-
www.hmrc.gov.uk/guidance/480.pdf

Does seem a strange way to do it though as both the company and her would be better off if they set up a group scheme and paid the premiums direct.

She had to set up her own one because the companys group one is with a health care company that only operates in Ireland (although rather not in the UK) So she was allowed to pick her own one and initially her company was going to pay them (Norwich Union) direct but were unable to do so as they couldn't setup a suitable payment method

Its not been done as a salary increase as such, on her payslip its marked down as Health Ben although this and her salary make up her gross pay

If this was a straightforward case with a UK company I would have thought it would be taxable and wouldn't have thought that it would be any different if paid by a "foreign" company although NI shouldn't be payable on it

Her company are always fair with the likes of expenses (and they have paid 2 months premiums up front) , etc and are probably unaware of the income tax/NI elements of making the payment (her actual salary is paid via a UK "salary bureau" as the company only have 2 UK based employees

To be honest its probably not a great amount extra she would be paying probably 10%(NI) of £70 per month although I guess if it was a group scheme her taxable benefit in kind would be less (although she might have not got such a high level of benefits from the scheme)

So the options ,from combining everyones replys, (cheers Kryten, Adam , Craig) the simplest way would be to submit it as expenses (although her bank charge a fee for payments direct from her company £8 I think) and then declare it on her tax form or for her company to add the tax and NI to her premium which would obviously be more than £8