Season tickets and bus services

Produced by a Tolley Employment Tax expert

Employment Tax

Guidance

Introduction

Employers may provide employees with assistance towards meeting the costs of public transport which the employee uses for commuting to and from their permanent place of work. In the majority of cases, this type of benefit would be subject to tax and NIC in full as well as reporting consequences. However, there are some common ways that an employer may assist an employee with their commuting costs that are exempt from tax and NIC. These are discussed below.

See Simon’s Taxes E4.715A.

Season tickets

There are a number of ways in which an employer might provide assistance in the purchase of an annual travel season ticket to an employee. The method of provision will dictate the tax, NIC and reporting consequences which are set out below.

Employer provides a loan for a season ticket

It is relatively common for an employer to make loans available for the purchase of season tickets. Generally, these will be within the exemption for loans which do not exceed £10,000. See the Loans provided to employees guidance note for details.

Employer

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