Reshma Johar looks at the potential advantages of PAYE settlement agreements for employers providing staff with certain benefits and expenses.
A PAYE settlement agreement (PSA) is there to alleviate certain benefits and expenses from having to be declared on either an employee’s form P11D or self-assessment tax return.
Employers will settle the tax and National Insurance contributions on behalf of employees, resulting in the employee receiving a benefit at zero cost.
What’s in – and out
There are three categories for qualifying benefits and expenses:
- Minor: examples include incentive awards, small gifts and vouchers, staff entertainment such as a ticket to an event. Note that most