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<p>It is a matter for individual employers as to whether they wish to pay the EU Settlement
Scheme fee on behalf of an employee.</p><p>In terms of employers choosing to reimburse
their staff for the cost of applying to the settlement scheme, taxation rules are
not a matter for the Home Office. However, HMRC has advised that in situations like
these, where an employer pays or reimburses their employees’ application costs, such
a payment would be taxable as earnings from their employment and may also attract
a National Insurance contributions (NICs) charge. However, employers can also choose
to meet the cost of this tax and NICs charge for their employees. For many employers
this can be managed within their existing arrangements with HMRC, using a PAYE Settlement
Agreement (PSA) which allows employers to make one annual payment to cover all the
tax and NICs due on minor, irregular or impracticable expenses or benefits for their
staff.</p>
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