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Tax treatment of Covid tests must be clarified

22 February 2021
Issue: 4781 / Categories: News

The ICAEW’s Tax Faculty has asked HMRC to confirm that the tax exempt treatment of Covid-19 antigen tests provided by employers will continue after 5 April.

The faculty notes that although the Revenue has updated its guidance to state that employers and their employees will not be liable to income tax or National Insurance contributions when an employee receives money from their employer for obtaining an antigen test no closing date is given.

In December 2020 the government said HMRC would use its collection and management powers not to collect income tax or National Insurance due on the advance payment or reimbursement of the cost of a Covid-19 antigen test until 25 January 2021. However between 25 January 2021 and 5 April 2021 legislation would be introduced to make the provision and reimbursement for antigen tests tax free.

The faculty said: ‘We...

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