2 min read
Definition
A benefit in kind is any non-cash benefit provided to a director or employee by reason of their employment — a company car, private healthcare, or an interest-free loan above £10,000 — treated as taxable and usually reported on form P11D.
In plain terms
It's a perk with a tax tail. You didn't get cash, but HMRC values the benefit and taxes you on it, and the company pays National Insurance too.
Why it matters for your company
A large interest-free director's loan is a common benefit in kind — charging the official interest rate avoids it. See the director's loan account explained.
Related reading
The director's loan account, explained in depth
A director's loan account (DLA) tracks money that moves between you and your company outside salary,…
Read →
Director's loan account
A director's loan account records money moving between a director and the company that is not salary,…
Read →How directors extract profit tax-efficiently
There's more than one way to get money out of your company, and the smart order matters. Salary, dividends,…
Read →
Acceleration (loan)
Acceleration is a lender demanding the whole balance at once after a default — the clause that turns a…
Read →Funding for UK limited companies
Credicorp lends to your company, not to you personally — short-term working capital with no personal guarantee. See what your business could access.