Benefits provider P&MM has been forced to withdraw its Greentravel2work bus travel product following confirmation from Her Majesty’s Revenue and Customs (HMRC) that the benefit-in-kind tax exemption will no longer apply in certain circumstances.
In an email to clients, Steven Guthrie, product manager in P&MM’s employee benefits division, said that following discussions with HMRC and partner bus operators, “P&MM wish to to advise the withdrawal of the greentravel2work salary sacrifice product”.
Guthrie listed the reasons as follows:
• support (financial or otherwise) must now be provided for specific bus routes for the tax exemption to apply;
• financial support should make a meaningful difference to the financing of a specified route;
• area-wide bus passes are not covered by the tax exemption as it is currently drafted;
• most season tickets issued by bus operators in the UK are zone-based, and as such, do not qualify for the tax exemption. This final point impacts the general availability of the product, and eliminates the potential to identify specific routes, Guthrie said.
P&MM had earlier sought clarification on the tax position of the scheme from HMRC, and received its reply earlier this month.
When contacted by Employee Benefits, Guthrie confirmed that the product had been withdrawn but declined to comment further.
P&MM will not process any new applications for the scheme, and as each employee’s agreement expires, there will be no renewal process through grrentravel2work.
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