COVID-19 Update – 21 December – Exemption for employer reimbursement of COVID test

Previously we noted the exemption for the provision of COVID antigen tests by employers, but not antibody tests. Now HMRC have confirmed that they will introduce a temporary income tax exemption and NICs disregard, to ensure employer-reimbursed coronavirus swab tests do not attract income tax or NICs liabilities in the current tax year.

We understand that for the test to be exempt it must have been purchased for business reasons, for example where an employee needs a negative test to travel abroad for business.

The measure will be legislated for in the next Finance Bill to have effect from 25 January 2021 until 5 April 2021.