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bigduckontax
bigduckontax, Accountant
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can a limited company give one of its directors a private flat

Customer Question

can a limited company give one of its directors a private flat that is owned by the company without either party incurring a tax liability
Submitted: 2 years ago.
Category: Tax
Expert:  bigduckontax replied 2 years ago.
Hello, I'm Keith and happy to help you with your question.
Yes, but the gift will be a benefit in kind unless Mum and Dad pay the company the market rent for the flat. Benefits in kind are declared on the Form 11D at the end of each tax year and the beneficiaries of the company's largesse subject to income tax on the benefit at their marginal rate. There is one exception for directors viz:
'You face a special threat to your security because of your job, and you live
in the living accommodation as a part of special security arrangements
in force to protect you.'
You can read all about the position of employees [remember directors are always classed as employees] in hMRC Help Sheet 202; You can read it in full here:
https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/323572/hs202.pdf
I do hope that I have given you some guidance in this matter.

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