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If a company pays an employee's personal payments, how's it recorded?

Paying payments on behalf of employees2:23

"If a company pays an employee's personal payments, how's it recorded?"

When the company pays for an employee's personal payments, it needs to be recorded as a: "Benefit-in-kind"

To record a company paying for an employee's personal payments as a "Benefit-in-kind":

  1. First, tap: "Menu", then "Expense claim"
  2. Select the person who the company's paying the personal payments for.
  3. Next, tap: Benefit-in-kind
  4. If you've got an image, like a receipt, that you'd like to include, you can upload, or take a photo of it.
  5. Then tap: Next
  6. Type in the value of the personal payments the company's paying.
  7. Set "Arranged by" to "Employee", and tap: Next
  8. Optionally, type in a short description about the personal payment expense, and tap: Next
  9. And because it's a payroll admin who's entering it, the expense is automatically approved.
  10. Now, to see how it shows up on the person's paystub, scroll down and tap: See on paystub
  11. And when you hover your mouse over the "Benefit-in-kind" amount, you'll see the details.
  12. And finally, you'll know that the personal payment's value is being correctly recorded and taxed.

Keep in mind that:

  • In some cases, the employee has themselves paid for the personal payment cost, and is asking the company for a once-only reimbursement.
  • To add a "Once only taxable benefit" reimbursement, tap: "Menu", then "Expense claim", select the person, and tap: Once only taxable benefit
  • Also, if the personal payment repeats every week, month, or every payday, set it up as a repeating: "Benefit-in-kind"

To learn more:

  • About how to set up a repeating "Benefit-in-kind", watch the video on: Repeating benefit-in-kind
  • Also, to learn more about personal payments, go to GOV.UK.

And that's it! That's everything you need to know about paying for an employee's personal payments!

Updated: Fri, Nov 3, 2023.

© 2020–2024 1st Money UK Holdings Ltd. All rights reserved.