Expenses and benefits: income tax paid on directors' behalf
What's exempt
You might not have to report or pay anything to HM Revenue and Customs (HMRC) if the director does not have a ‘material interest’ in your company, and either of the following applies:
- they’re a full-time working director
- your company is a charity or not-for-profit organisation
In broad terms, a director has a material interest in a company if they (alone or together with associates) own or can control more than 5% of its ordinary share capital. This is explained in more detail in the technical guidance.