You only receive the benefit if there is a claim unless the cover comes with regular medicals for the staff.
I'm afraid that the company accountants are correct in the way that they have dealt with the annual payment.
I hope this clarifies things for you but let me know if you have any further questions.
So you are saying that a company choice on funding method impacts the benefit charged to the employee? That doesn't really make sense in the context of a group scheme, because the employee is suffering for no logical reason.
I've been completing P11Ds for many years and I can only tell you what the tax rule is. Your employer might say that its more efficient to pay the premium annually and I know some providers give discounts for annual payments as opposed to monthly payments.
Yes I understand it would be the norm. However I am quite attracted to the argument that one should first look at what benefit has been received - in this case 6 months worth of medical insurance - and then calculate the cost of that benefit.
The tax point is the date of payment in the case of private medical insurance provided by an employer. You have full cover from day one so the fact that the premium covers part of one tax year and then the next is irrelevant. If your employer paid your annual car insurance premium and that cover was spread over two tax years, the payment would be taxable as additional salary through the first payroll run following that payment. My point is that tax isn't always logical.
That depends on the terms. I've had clients who have continued to be covered after retirement, at least for a few months and have, therefore, had a taxable benefit.
If the cover ceases when the employee leaves, then the taxable benefit can be apportioned.
Would you mind rating my answer before you leave the site please.