Eye test

Quick question, does the cost of an eye test come under 'Other expenses'? Thanks in advance.

Hi,

You cannot claim this as an expense as it is not solely related to your employment.

Thank you.

We have always understood that an annual Eye Tests provided to all employees who use a VDU was exempt from tax and NIC as it is a Health & Safety at Work requirement. We also understood that the eye test could be provided via an Eye Test Voucher, booked directly by the Employer with the optician or refunded to the employee. However the guidance at EIM21765 appears to suggest that reimbursed eye tests are now charged to tax and NIC but also says they are free of tax and NIC. At the bottom of the EIM page the guidance states "Where an employee is required to use a visual display unit (VDU) as part of his or her normal duties, no chargeable benefit will arise on the provision of: an eyesight test spectacles or contact lenses required solely for VDU use that an eyesight test shows are necessary, where the test is required under Health and Safety at Work regulations and, they are available generally to all employees (in the case of corrective appliances (e.g. glasses and contact lenses), only if shown to be necessary by the test). However, the next section goes on to explain Where spectacles are for general use, but include a special prescription for VDU use, a proportion of the cost relating to the special prescription will be exempt from a chargeable benefit. The provision of spectacles for general use, including use with a VDU, which do not include a special prescription for VDU use will give rise to a taxable benefit. Again this all makes sense. However the final piece of the guidance states: "Where the cost of an eyesight test, spectacles or contact lenses is reimbursed to the employee, a taxable benefit arises." Can you confirm this final instruction only relates to where eye tests are not necessary under Health & Safety for VDU Users? I ask as it is not worthwhile our paying for a voucher scheme with a large provider for 2/3 eye tests a year and so would want to simply reimburse employees the cost on production of a receipt. Many thanks

Hi,
 

The key word in this sentence is "Reimburse" if the employer arranges and pays for the tests etc directly it is exempt. If the employee pays and is reimbursed it would just through payroll as normal. Thank you.

my sister who is an employer always pays such tests for her employees, so I guess every employer decides what he will "Reimburse" or not

Sorry to resurrect this one, but this has come up recently during a discussion here. The EIM guidance above confirms that a taxable benefit arises where an eye test is not provided directly by the employer, but the costs are reimbursed to the employee. The guidance provided by HMRC Admin 17 was that this reimbursement should be "paid through the payroll as normal" which implies that it is not a taxable benefit if there is no P11D reporting required. By paying it through the payroll, this implies that it would be earnings. However the National Insurance Manual (at NIM02145) confirms: "If it is the employee who arranges the test and the employer reimburses them, then by virtue of Regulation 25 and paragraph 9 of Part VIII of Schedule 3 to the Social Security (Contributions) Regulations 2001 you can disregard the payment, as Health and Safety legislation considers an eye test to be an expense incurred in relation to the employment." Can we please have a definitive answer on this one please? Thank you

Hi Tim Bridgett,

Eye tests are considered exempt if they are required by health and safety legislation for employees who use a computer monitor or other screen.
Expenses and benefits: medical or dental treatment and insurance.
If the eye tests do not meet the exemption criteria, then a benefit will arise.
As to how to report this, depends on how the benefit has been arranged and paid for.
Where reimbursement has been made to an employee, the payment is treated as earnings and reported via the payroll for tax and Class 1 NIC.
Expenses and benefits: medical or dental treatment and insurance What to report and pay.
I hope this clarifies, however, should you need any further assistance, please contact the Employer Helpline on 0300 200 3200.

Thank you.

Hi Tim Bridgett,
****
Update to guidance. 

Where eye tests or/and corrective appliances are provided by an employer to an employee no liability to tax arises as long as:-
A.         Provision is required by regulations made under the Health and Safety at Work Act 1974 and
B.         The provision is made available generally to all employees
Expenses and benefits: medical or dental treatment and insurance.
If the eye tests do not meet the exemption criteria, then a benefit will arise.
As to how to report this, depends on how the benefit has been arranged and paid for.
Where reimbursement has been made to an employee, the payment is treated as earnings and reported via the payroll for tax but not for Class 1 NIC.
Expenses and benefits: medical or dental treatment and insurance What to report and pay.
I hope this clarifies, however, should you need any further assistance, please contact the Employer Helpline on 0300 200 3200.
Thank you.