02 March 2021 
Julia Ascott, Employment Taxes Specialist
Caroline Jones at BDO has provided further clarification to our members on whether the NHS surcharge can be paid for by the sponsoring employer without tax obligations. It also confirms the position on intial visas as well. With thanks to Caroline for this:
NHS surcharge HMRC’s original position, as confirmed in the expat forum of July 2015, is that this relates to an individual’s presence in the UK, not their travel to get to the UK. However, in November 2015 HMRC changed their position and confirmed that the NHS surcharge can be considered as part of the visa costs, and as such, relief will be available under the special rules for travel as an associated cost of travel. Please note, relief is only available if the costs are paid alongside the visa, on the initial move to the UK. If the Employer pays this surcharge at a later date, this would be considered a taxable benefit and no relief would be available. The payment of the surcharge by the employer discharges the employee’s pecuniary liability which means for social security purposes (if applicable) this would need to be dealt with by payroll. From an income tax perspective it is a P11D item, but you may find it being reporting in the PSA.
