Navigating tax exemptions can be tricky, but when it comes to mobile phones, there’s a straightforward way to benefit. Here’s what you need to know:

1. Single Phone Perk:

Offer your employee a mobile phone for personal or combined use, ensuring the company retains ownership. This covers both the phone and any associated costs like calls or data.

2. One’s Company, Two’s a Crowd:

This benefit only applies to one device per employee. If they receive more, or if family members get phones for personal use, those additional phones aren’t exempt and will incur tax.

3. Business Phones are Different:

If an employee gets a second phone exclusively for work, and it’s only used for that purpose, no extra tax charge applies. So, an employee can technically have a personal phone and a business phone without any tax hassles. However, if both phones serve dual purposes, tax applies to one of them. It’s savvy to keep one strictly for business.

4. Avoid the Salary Swap:

Don’t trade a portion of an employee’s salary for a mobile phone. This strategy nullifies the exemption, and the tax will be based on the sacrificed salary.

In essence, when offering mobile phones as perks, stay informed to make the most of the available tax breaks.

If you found this useful, please share it using the icons at the side of the page, or leave a comment below.

Any questions?

If you’d like a meeting or a video call to discuss this, please get in touch with your favourite Liverpool accountant