Every time you’re tested for coronavirus at work, you will be hit with more tax under the latest rules from HMRC.
Guidance published yesterday (6 July) classed the life-saving and curve flattening medical treatment in the same bracket as company cars and private medical insurance.
Worse, with some jobs requiring multiple tests the bills could mount up fast.
The change in rules has seen urgent letters sent to Chancellor Rishi Sunak urging him to explain how this has been allowed to happen and what he plans to do about it.
Mel Stride, chair of the Treasury Committee, said: “This cannot be right. I’ve asked the Chancellor to look into this as soon as possible.”
What the change means is that the cost of every test your employer pays for is added to your salary – meaning you pay tax on it like you would a rise in your wages.
But, unlike a pay rise, you’re not actually handed anything extra in earnings.
So if a test costs your boss £20, a basic rate taxpayer will see their take home pay drop £4 as a result.
Stride said: “Many employees, especially healthcare and hospitality workers, are required to undergo regular coronavirus testing. This new guidance is unclear and will worry a large number of workers.
“If these tests are to be treated as a taxable benefit in kind, the tax bill for workers could soon mount up.”
Martin Lewis said he was delighted that action was being taken by the Treasury committee, adding there was still hope no one would see their pay fall as a result of being tested for coronavirus.
“There’s a lot of people understandably gobsmacked by this,” he tweeted.
“This is likely to be HMRC enacting the the law as it stands.
“It’s for the Treasury to actively make an exemption – and one presumes (hopes / prays) doing so is just another tick on a planned list to get sorted.”