Last updated: 16 October 2026
Is it taxable to pay for employees’ health screening or tests?
Usually not. Employers can provide one health screening and one medical check-up a year to each employee tax-free, as long as it’s available to all employees or a group of them. Covid-19 tests provided by employers were tax-free under a special exemption that ended in April 2022, but routine screening for illness at work can still fall within the health screening exemption or count as a business expense. Private medical treatment and insurance, by contrast, are taxable benefits.
Tax-free health benefits
| Benefit | Taxable? |
| One health screening a year | No |
| One medical check-up a year | No |
| Eye tests for screen users | No |
| Occupational health services | No |
| Flu jabs offered to all staff | No |
| Recommended medical treatment up to £500 to help return to work | No |
| Private medical insurance | Yes |
| Gym membership | Yes |
What counts as screening?
- Health screening identifies employees who may be at risk of ill health
- A medical check-up checks for existing conditions
- Both must be offered to all employees, or to groups based on risk
- More than one of each per year is taxable
Company deduction
The cost of tax-free health benefits is deductible for the company. Private medical insurance is also deductible but taxable for the employee, reported through payroll or P11D, with Class 1A NIC at 15%.
Example
A construction firm pays for annual lung function screening and a hearing check-up for its 30 site workers, costing £120 each. As one screening and one check-up a year, these are tax-free. It also gives the directors private medical insurance at £1,200 each, which is a taxable benefit.
Covid-19 tests
Between 2020 and 2022, employer-provided or reimbursed Covid tests were exempt. That exemption has now ended. Workplace testing for health and safety reasons, such as in care settings, can still be treated as a business cost with no benefit if it’s required for the job.
Payrolling from April 2027
Taxable medical benefits, such as private medical insurance, are in the first phase of mandatory payrolling and will have to be payrolled from April 2027 rather than reported on P11Ds, according to HMRC’s August 2026 Employer Bulletin.
Common mistakes
- Offering more than one screening or check-up a year
- Treating private treatment as screening
- Providing screening only to directors
- Forgetting to report insurance
Records to keep
Keep invoices, records of who was offered screening, and the type of tests provided.
Return-to-work treatment
If a GP or occupational health service recommends treatment to help an employee back to work after at least 28 days of sickness absence, the employer can pay up to £500 a year per employee tax-free. Treatment above £500 is taxable on the excess. This often covers physiotherapy or counselling, and it must be recommended in writing.
Frequently asked questions
Can the company pay for glasses?
Yes, basic glasses needed only for screen work are tax-free.
Can directors get tax-free screening?
Yes, if offered on the same basis as employees.
Are cancer screenings included?
Yes, if they’re screening tests.
What about mental health support?
Employee assistance programmes are usually tax-free.
Employee assistance programmes
EAPs offering counselling and advice are usually tax-free, provided they’re mainly for wellbeing and not private medical treatment.
Related: private medical insurance, BIK reporting changes and employee reward schemes.
Talk to Accotax
Want this handled for you? Our team at Accotax can help with employee health benefit advice. See our payroll accountants service, or contact us for a free, no-obligation quote.
This page is general guidance based on HMRC rules for the 2026/27 tax year, checked against gov.uk on 16 October 2026. It is not personal advice, so speak to an accountant about your own situation.
