Benefit in Kind- acceptable evidence for ILR application

[jay09]

Guys,

Some of you may have noticed in my most recent post that I could be a bit short of the required minimum pay for my job occupation which is currently under SOC 2129.

Prior to the last MAC review, my SOC was 2121 and the required minimum pay for the SOC code was within my current salary at the time.

The change in SOC from 2021 and 2129 has made a huge difference and cld lead to ILR refusal in my case. However, I could make amends for the shortfall , becasue I have a company car and also receive free fuel for personal use. As you guys might know, free company car and fuel is classed as benefit in kind (BIK) and the total cash equivalent is always taxable and could therefore be included as part of a salary remuneration package.

If i was to include this in my application, could anyone let me know if there is any form of evidence that the UKBA will require from me as a proof. Obviously, my employer will have to mention it in the support letter.

I also have my current tax code letter and it includes the calculated cash values for the BIK for 2012/13 (this was used to derive a tax code for the current year).

Has anyone had his/her ILR approved with this kind of BIK considered as part of the salary package.


Thanks

[vinaya]

This cannot be used towards calculationg your gross income for ILR purposes. Speak to your employer and request him for a pay increase

[jay09]

[quote="vinaya"]This cannot be used towards calculationg your gross income for ILR purposes. Speak to your employer and request him for a pay increase[/quote]

Vinaya,

You got it all wrong. The P800 tax calculation considers payments declared on P11D form (in this case for car and fuel benefits) from employer as part of gross income for any employee.

[vinaya]

I have given my perspective, why do you ask if you are so sure!

[jay09]

[quote="vinaya"]I have given my perspective, why do you ask if you are so sure![/quote]

I asked to know what type of supporting evidence to include when applying and to hear from people that have experience in this area. Your view is noted nevertheless.

[barker]

I believe Vinaya is right in what he says. As per the guidelines in Appendix A for earning assessment you can include allowances made by an employer as long as they are included on your payslip.

I do not know much about the BIK taxation and its implication. But from the text on the UKBA site they wont accept it unless it is included on your payslip.

[vinaya]

Cheers Barker....BIK is not part of the salary and only forms part of P11d. Normally your PA gets reduced by the level of benefit provided and you are taxed accordingly on your salary.

[jay09]

Vinaya/Barker,

Barker, BIK is technically reflected on the wage slip because it is used in determining the appropriate tax code for the BIK beneficiary.


As said by Vinaya, the HMRC deducts the total cash equivalent of the BIK from the tax free personal allowance (PA) and the difference is converted into a tax code (usually K-codes) which the employer then uses to deduct tax for any payments made to the employee.

So from the above you can see that it is actually considered as part of the employees remuneration/gross income and obviously tax code is definitely included in any wage slip.

That said, I already know that the UKBA considers BIK as part of a salary package (through correspondence between my solicitor and the UKBA back in 2009) and I'm really interested in knowing what form of evidence they would expect for any ILR application, of which the applicant is claiming earnings on BIK.


Thanks for your inputs barker and vinaya

If anyone has had ILR approved with BIK as part of the earnings plz let us know.

Thanks

[easyguy]

Hi Jay09

I have the same issue i.e. with BIK. I have to apply for Tier 1 extension this year and K376 code coz I have a company car with full fuel allowance. This is definitely counted towards previous earnings as it is part of salary package. But I don't know what evidence or proof to provide for this.

I have posted a question about this on the forum here - http://www.immigrationboards.com/viewtopic.php?t=101102

You mentioned that you discussed this with your solicitor in 2009. But did he not tell you about any documents that you can show as evidence for this?

I don't know about ILR but I'm guessing it will be the same as claiming points for earnings for any visa application.

Any suggestions or advice is very much appreciated.

Thanks.

[jay09]

Easy,

Please note that i've not actually used BIK as part of any of my previous applications.

In the case of Tier 1, which looks at previous eanrnings for the financial year/at the time of application, I would imagine that P11D which will detail the total cash equivalent for the car and fuel will be fine. I will also advice that you obtain a letter from your employer confirming the BIK and also assuring the UKBA that the BIK will still continue for the future years that you will be with them.

In the absense of any additional advice from forum members, I intend using my employer's letter and current Tax code letter from HM Revenue and Customs for 2012/13 which indicates the taxable cash total for my car and fuel for the current financial year. I will also take with me previous P11Ds with details of total cash for car and fuel benefits.

Hope this helps
[quote="easyguy"]Hi Jay09

I have the same issue i.e. with BIK. I have to apply for Tier 1 extension this year and K376 code coz I have a company car with full fuel allowance. This is definitely counted towards previous earnings as it is part of salary package. But I don't know what evidence or proof to provide for this.

I have posted a question about this on the forum here - http://www.immigrationboards.com/viewtopic.php?t=101102

You mentioned that you discussed this with your solicitor in 2009. But did he not tell you about any documents that you can show as evidence for this?

I don't know about ILR but I'm guessing it will be the same as claiming points for earnings for any visa application.

Any suggestions or advice is very much appreciated.

Thanks.[/quote]

[easyguy]

Thanks for your reply. I'm not sure when I'll get the P11D form. I think its usually after June every year. However I will try to enquire about from HMRC and also our company accountant. I will update you after I get the info.

[jay09]

Easy

Yes usually official P11D comes around june depending on when your employer files in their returns to HMRC. But you can ask the accountant to fill out one manually and make a copy for you to use in your extension. It will obviously be the same amount as to what he/she (accountant) will forward to the HMRC.

I certainly did the same in 2009 when I appealed against the UKBA decision on my LTR extension application.

cheers



[quote="easyguy"]Thanks for your reply. I'm not sure when I'll get the P11D form. I think its usually after June every year. However I will try to enquire about from HMRC and also our company accountant. I will update you after I get the info.[/quote]

[easyguy]

Jay09,

I thought you never used BIK for your previous applications? Or did you use it when you had to appeal against the decision for your LTR in 2009? If you don't mind me asking, was the first decision on your application related to BIK or any allowances that UKBA did not accept initially?

The accountants have said that I won't be getting anything until june or july so I might have to ring HMRC and find out if I can get anything of them. When do you think you'll be applying for ILR roughly? Will it be before you get the P11D or after?

[jay09]

[quote="easyguy"]Jay09,

I thought you never used BIK for your previous applications?

Answer: Correct.

Or did you use it when you had to appeal against the decision for your LTR in 2009?

Answer: Yes I used it, but only as a back-up to my arguements, because my initial application at the time stated only my basic salary

If you don't mind me asking, was the first decision on your application related to BIK or any allowances that UKBA did not accept initially?

Answer: No-initial LTR extension application mentioned my basic salary which was below the going rate at the time, so when the UKBA refused my application, I then appealed against the decision and included my BIK to argue that my remuneration was above the expected minimum wage.

The accountants have said that I won't be getting anything until june or july so I might have to ring HMRC and find out if I can get anything of them. When do you think you'll be applying for ILR roughly? Will it be before you get the P11D or after?

Answer: Yes my ILR will be late October at the earliest....and I should get my P11D about July time. Does your current or any of your previous tax code letters from HMRC include your car & fuel benefits?I think it will be okay for you to use the tax letter as evidence of your BIK...because the same tax code will prbably be what your employer is applying in your monthly payments.

Hope this helps.

[easyguy]

Thanks for your reply, it is indeed of great help.

For your appeal you did use BIK to prove that you meet the earnings required. So basically that means that if we just send payslips and bank statements without anything to back up BIK, UKBA will simply ignore it.

Yes I received 2 tax code letters that mention the car and fuel benefits in detail, one when I got the car and another this month for April 2012-2013 with code as K376 and all the calculations notes saying that I have to pay tax on additional £5967 for car & fuel.

And my employer always applies the updated code, so all my payslips reflect whats on the tax code letter and the final amount reflects what I receive monthly into my bank account.

Do you remember what documents/evidence your solicitor had used to show the BIK?

Many thanks

[jay09]

Easy

Current tax code letter should be okay to prove your anticipated earnings for 2012/2013. Additional evidence to me will be pay slips, bank statements and letter from employer. Please ensure that the content of the letter includes your BIK and they taxable cash equivalent for the current year.

In my case, I used P11D for the previous year (NB: my appeal was around June...so I already had my P11D for previous year ), and letter from employer (accountant).

cheers

....................................................
[quote="easyguy"]Thanks for your reply, it is indeed of great help.

For your appeal you did use BIK to prove that you meet the earnings required. So basically that means that if we just send payslips and bank statements without anything to back up BIK, UKBA will simply ignore it.

Yes I received 2 tax code letters that mention the car and fuel benefits in detail, one when I got the car and another this month for April 2012-2013 with code as K376 and all the calculations notes saying that I have to pay tax on additional £5967 for car & fuel.

And my employer always applies the updated code, so all my payslips reflect whats on the tax code letter and the final amount reflects what I receive monthly into my bank account.

Do you remember what documents/evidence your solicitor had used to show the BIK?

Many thanks[/quote]

[jay09]

Many thanks to all the contributors in this forum.

I was granted ILR on 5th Nov at PEO Glasgow

My 5 years was made up of 18 months Work permit and 3.5years Tier 2 General (granted under transitional arrangements).

If you read through my previous posts you will find out that I had posted about combining benefit in kind (BIK) with basic salary to make up for expected going rate under the SOC codes of practice. I did exactly that because my basic salary was slightly below the going rate but because I have a fully funded company car which I use for both work and private, and I also pay a 20% tax on the cash equivalent of that benefit.

Documents produced on appointment day


1. SET O form
2. Letter from employer confirming pay and continued employment
3. Letter from accountant detailing company car and cash equivalent of the taxable BIK
4. HMRC Tax code letter for 2012/2013 which considered my company car
5. 3 months pay slip (Note: I was ask to produce all three)
6. Online bank statement with supporting lette
7. LIUK test result

NB: Amongst all these, the case worker was only interested in nos. 1,2,35 and 7.

Appointment was at 11am and by 12.30pm, I was already on the road heading back to England. Yes, it was that quick and smooth that you don't even have to worry for a cup of tea, when waiting for decision. PEO Glasgow seem to be a very good place to apply for ILR. All the UKBA staff that I came across seemed very nice, including the security guys. May be I was just lucky!!


I hope my summary would help someone out there who will soon be applying.

Many thanks to all those who have contributed to this forum...Moderators....I can't thank you guys enough but be assured that your good work on this website is definitely changing peoples life for good.


GOD BLESS