International employees don’t get taxed on benefits, but I do: ask the expert

I am not a tax expert and, without more information regarding your colleagues, I am only able to give you broad advice.

I understand it is a legal requirement for HMRC to deduct tax from employees’ benefits. However, it is possible that no equivalent rules apply in the countries where your colleagues work.  You don’t say whether your colleagues are tax residents in the country in which they work, or whether they are on an overseas assignment. If the latter, their salary and benefits are governed by the HMRC rules.  This could have a significant impact on your case and I would suggest you ask your employer to clarify this point.

I anticipate that your contract is governed by the jurisdiction of England and Wales, and as a result you have the right not to be discriminated against.  There are different elements to discrimination, for example:

1.      The right not to be treated less favourably because of a protected characteristic, such as sex and pregnancy and maternity.  This is where an employer treats you, personally, less favourably.

2.      Employers must not have any provision, criterion or practice which puts women (for example) at a disadvantage when compared with men.

3.      Equal pay.  Anyone employed under a contract personally to do work is entitled to contractual terms that are as favourable as those of a male comparator in the same employment, if they are employed on equal work (i.e. like work, work rated as equivalent or work of equal value).

If you are able to demonstrate that your employer has breached any of these elements of discrimination, you may have the right to bring Employment Tribunal proceedings.  You can do so while employed and, if successful, you would be entitled to compensation for any losses suffered together with injury to feelings for the discrimination that has occurred.  If you decided that there had been a fundamental breach of your contract by your employer for non-payment of the tax on your benefits and / or discrimination, you could resign and claim constructive dismissal.  Where dismissal is because of discrimination, the requisite two years’ continuous employment (for employees employed after 6 April 2012) is removed and employees with under two years’ service can present this claim.

Prior to issuing proceedings however, I would recommend raising a formal grievance with your employer asking for an explanation as to non-payment of the tax on your benefits when compared with international employees.  This may resolve matters. If it does not, you will need to contact ACAS in order for mandatory early conciliation to take place whereby they try and facilitate settlement.  If there is no success, you can then issue Employment Tribunal proceedings together with any relevant issue fee no later than three months’ less one day from the last act of discrimination. However, notwithstanding the above, my advice is to talk to your employer in order to establish why your colleagues who work abroad are subject to different tax treatment before going down the grievance route.

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• Self-employed Equality Pay Advice Tax