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Tax for provision of parking spaces

Source: HM Revenue & Customs | | 24/09/2019

There are some important rules to be aware of if you provide parking spaces to your employees. If the parking places you provide are at, or near your employee’s workplace, then you are entitled to an exemption. This means there is no requirement to report anything to HMRC and you would not be required to pay any additional tax or National Insurance for these parking spaces. These rules include the provision of parking spaces for cars or motorbikes at, or near, the employee’s place of work. The provision of facilities for parking bicycles is also exempt.

There is no legal definition of the words 'at or near' in the relevant act and HMRC say the exemption is available in any case where parking facilities can be said to be within a reasonable distance from the place of work, having regard to the nature of the locality. It does not matter if the car park is not the one closest to the place of work.

However, if you provide parking places which aren’t covered by an exemption, you will need to report them on form P11D and pay Class 1A National Insurance on the cost of providing the parking places.

The exemption does not apply to parking spaces you provide that are not either:

  • at or near the employee’s workplace
  • for use on a business journey.
 

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McAllisters is a partnership trading from Paxton House, 11 Woodside Crescent, Glasgow providing accountancy and tax services and general business advice and is a member of ICAS (Registration No 0342) and an FCA exempt professional firm (No 301235). Its VAT number is 261 3019 94

McAllisters (Scotland) Ltd is a related business providing tax and business advisory services to McAllisters and its clients. McAllisters (Scotland) Ltd is registered in Scotland (Registration number SC146856). Its VAT number is 624 0564 62.

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