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Businesses warned over duel SIM mobile phones

Surrey accountants Midgley Snelling are warning businesses providing their employees with duel SIM mobile phones should be aware of rules which could jeopardise tax exemption.

Employers can provide their workers with one mobile phone for private use as a tax-free benefit-in-kind (BiK), however this exemption only extends to one phone number.

A duel SIM phone where the employer can use both numbers for private calls will trigger a tax charge.

Tax Partner Peter Bond said: “We are urging employer to tell their employers to only use one of their numbers for personal calls.

“The other SIM should be reserved for business use only, meaning that the tax and NI exemption will continue to apply to the handset and the mixed use SIM, while there would be no BiK charge on the other because it’s not available for private use”.

Employers are being advised to put this in writing to avoid troubling HM Revenue and Customs.

Alternatively employees could buy a pay-as-you-go (PAYG) SIM (UK or overseas) to load in the phone for when they want to make private calls without using the second SIM number.

If the company pays for the PAYG SIM, the taxable BiK will be equal to the cost of the this, rather than for the full cost of the contract on the second SIM.

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