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Tax deductible mobile phones for employees

Monday September 2019

Q. I am the director of a family-owned company. My wife and my two children are employed by the company. If the company provides a mobile phone to each of us, what will the tax implication be?

A. No tax charge arises where an employer provides an employee with a mobile phone, irrespective of the level of private use. The exemption applies to one phone per employee.

A taxable benefit will however, arise if the employer meets the employee’s private bill for a mobile phone or if top-up vouchers are provided which can be used on any phone.

If the company takes out a contract for four mobile phones and the bills are paid directly to the phone provider by the company, the bills will be deductible in computing profits. Each family member will receive the use of a phone tax-free, which means they do not need to fund one from their post-tax income.

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