Employer gives unwanted goods to staff else pays to dispose

[Incredulum]

A company is moving offices. In the new site it will have new furniture.

It will have to pay to dispose of the old furniture in order to return the old building with vacant possession to the landlord.

If it offers the funiture to its staff for free is there any risk of there being a benefit in kind?

I'm assuming that the benefit is calculated as marginal cost. The marginal cost to the company is negative owing to the disposal costs.

[robbob]

Why doesn't the company pay the employee 40p a mile to take the stuff to the skip in the back of their car

[mullet]

I'm not sure that marginal cost is the right principal here. I thought that marginal cost flowed from Peper v Hart, the case involving the children of Malvern College teachers who paid 20% fees. So I would see the Peper v Hart principles applying to services provided by employers which are also "purchased" by the general public or provided in the general course of business, e.g. sports clubs, gyms, schools (obviously), car repair workshops etc etc. The point is that it costs only a marginal amount to provide the benefit to employees, as the services etc are already being provided for an alternative primary purpose. A good example is using your employer's photocopier. If any charge was levied by a mean employer, it should be just the cost of paper and perhaps a litte toner, not a proportion of the lease/purchase/servicing costs etc.

What we have here is the transfer of assets to employees. They are not new assets and nor are they assets previously charged as benefits, so the special rules do not apply. For employment income purposes they are deemed to be transferred at market value. If the furniture is not particularly "special" and is not brand spanking new, then I suspect that it wouldn't be worth anything - particularly if offered for sale at its present location and fully assembled. As long as it is offered to the employees on the same basis, I cannot see any employment income charge arising since the MV will be £nil.

So I think you've got the right answer but by the wrong route.

[Incredulum]

Thanks. Establishing market value as nil through use of a third party who would require payment to remove the assets seems to solve the problem.