“We live in an age where many employees are provided with a mobile phone, laptop or internet access at their homes; yet the tax rules have not woken up to this change which potentially leaves employees exposed to a benefit in kind.
“HMRC has now advised the smartphone, is a mobile phone for tax purposes and, subject to only one phone being provided to an employee that no benefit in kind will arise. There is however, a potential difficulty because HMRC’s definition of a mobile phone does not include apparatus with satellite navigation devices, or devices that are solely PDAs and tablet and laptop computers. In general, devices that use Voice Over Internet Protocol (‘VOIP’) systems to make and receive phone calls will not satisfy the primary purpose test.
“Additionally, in theory if a laptop is provided to employees and there are no restrictions over the use then again a potential benefit in kind may arise.
“We also have seen many employers, who require workers to ‘home work’ and have paid for internet access. In a number of these arrangements a potential benefit in kind may arise.
“It seems important that HMRC gives clear guidance to employers and clarifies how they accommodate their employees, who work from home, without creating a tax risk.”