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Housing allowance for church minister

07/05/2019 14:28:25
We would like to give a housing allowance of £2000 per year to an employee, a minister of religion. This housing allowance is not to pay for rent it is just additional as they use a study in their own house to work often, there is also a place of work provided by us the employer.

I was told to add this as a non-taxable expense but understand this is taxable.
Should I pay it in addition to the salary as an expense and just add it to the P11D?
On the P11D do I add the £2000 housing allowance under Living accommodation or other?

Thank you for your help!
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Re:Housing allowance for church minister

07/05/2019 16:48:02
It appears to be an allowance that you pay to your employee because he is an employee and he is studying in his home. Although you state you also provide a place of work for him/her. So it is a matter of choice.
As you are paying additional £2000 per year/£166.66 per month purely because he/she choses to study and not in relation to rent or indeed a housing allowance.

I believe it would be taxable as it is being paid for study, so it is the individual’s choice to do this.

Guidance how to complete P11d and P11db there includes a link for the Booklet 480 and in particular I would look at Chapter 6 which should help you.

This message was edited 1 time. Last update was at 08/05/2019 08:45:18

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Housing allowance for church minister

09/05/2019 07:14:07
If we pay this additional allowance as an addition (even if we call it housing allowance) we would pay PAYE tax but would we still need to pay NICs and Pension?
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Re:Housing allowance for church minister

09/05/2019 10:06:41
Class 1A would be due on the payment. I would suggest you contact Pension Regulator with regard to the benefit.
Telephone number is 0345 600 1011
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Housing allowance for church minister

09/05/2019 14:29:39
A round sum allowance goes through the payroll so class 1A NI is not due as class 1A NI relates to P11D items. It will be included in the pensionable amount. The link to the completion of a P11D is not relevant.

Again this is a serious failing of this forum.
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Re:Housing allowance for church minister

22/05/2019 14:35:49
Hi,

Thanks for your comments.

Round Sum Allowances payments are classed as earnings and should be taxed and NIC is also due.

Please see the link to guidance below:

Expenses and benefits: cash sum payments to employees

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