Our client is a limited company. The director and the employees have company credit cards that they use to purchase goods on behalf of the company. The company credit card generates Air Miles. If the air miles are given to the director/employees, would this be classed as a benefit in kind (BIK)? If there is a BIK, how is the BIK valued?

As per Income Tax (Earnings and Pensions) Act 2003 section 204, the benefit in kind (BIK) would be the expense incurred in or in connection with the provision of the benefit.

In other words, the BIK would be the cost of the provision – the cost to the employer on providing the air miles.

So, if the company was purchasing air miles and then giving them to the director/employee, there would be a BIK. The BIK would be the cost to the employer of purchasing those air miles.