If a company pays for private medical insurance for its employees and the contract is between the employer and the insurance company, is there a tax charge on the employees? Can the company deduct the cost of the insurance from its profits?
Where the employees earn £8,500 or more a year, or are directors, there is a tax charge for the individuals based on the cost to the company of the insurance. There are exceptions to this tax charge for eye-tests required by health and safety legislation, annual medical checks or health screenings. The company can deduct the cost of the insurance from its profits, as it is part of the cost of employing staff.