Tax Relief on Staff Training
It might be a surprise to learn that money spent on training does not automatically qualify for tax relief. It actually depends on two factors: who pays for it; and what it is designed to achieve.
If the employer pays for training, it will generally be eligible for relief - provided it is aimed at enabling employees to do their jobs better. This is even the case if the training covers generalist, 'soft' skills that do not rapidly deliver an identifiable advantage.
The situation is very different when the employee pays for his or her own training. Tax relief is not normally given, except when the training is required as an absolute necessity for the employee to carry out their own job. So it will not qualify, even if it solely is designed to help them do their job better, or if it enables them to carry out a new job.
In addition, when an employer reimburses an employee for training they have paid for, this will be seen as a benefit in kind that is taxable.
Any business with a training need that is likely to be costly, however it is paid for, should take professional advice on how best to approach it.
Contact
Judith Ellery Head of Employment
Bethan Southcombe Solicitor
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This article summarises the law on issues which we believe may be of interest to your business. It is not a comprehensive review of the subjects and accordingly is published without responsibility for loss occasioned to any person(s) acting or refraining from action as a result of information published. This document is provided for information only and does not constitute legal advice. Professional legal advice should be obtained before taking or refraining from any action as a result of the contents of this document.