9. Communications and IT

9.3 Fixed-line telephones

(a) Definition

Fixed-line telephones are defined as communications devices, the primary purpose of which is the transmission and receipt of spoken messages via a cabled or wired public electronic communications service.

They may also have secondary data, video or text facilities that do not exclude them from this definition.

Associated costs include both those related to the equipment for accessing a network or service and the service charges for that access.

Fixed-line telephone costs The following are considered to be examples of fixed-line telephone costs:
Hardware	The telephone Wireless hand-sets that connect to the network through a wired base station; Cable extensions and accessories.
Services	Connection charges; Line rental; Itemized or inclusive call plans.

The following are NOT considered to be fixed-line telephone costs.

Exclusions to the definition of fixed-line telephones:

Mobile telephones;
VoIP (Voice over Internet Protocol) telephony, including Skype and similar services;
Blackberry or other forms of portable computer devices that provide primarily e-mail / data as well as voice and text services;
Internet, cable or broadband connections, the primary purpose of which is data transmission, except for any separate elements charged as telephone line rental.

A flowchart is provided to help determine correct treatment of payments relating to fixed-line telephones.

(b) Fixed-line telephones provided by the University

Where a fixed-line telephone is provided and paid for by the University then it will be exempt from any tax charge only as long as the following circumstances apply.

Tax exempt fixed-line telephones provided by the University Either:
On University premises	Are not considered to be a taxable benefit as long as they are used for business purposes.
Or:
On private premises	The contract must be in the name of the University and not the individual living at the premises; and The facility must be supplied for business use only as a necessary part of the individual's responsibilities; and Staff provided this facility must have a clause in their contract of employment or a letter varying their contract that states that the provision of the telephone is a necessary requirement of their employment

Any fixed-line telephone provided to private premises by the University must be on an itemized call plan. This is to satisfy HMRC requirements that private use can be shown to be insignificant, i.e. less than 10% of total usage.

Note: Where business use can be shown for telephones supplied to private premises there is no restriction on the number of lines provided.

Where telephones are provided by the University that do not meet these rules then a taxable benefit will arise. See Appendix 4.

(c) Fixed-line telephones owned by individuals but used for business purposes

Where a fixed-line telephone is owned by a private individual then claims for reimbursement of costs from the University will be exempt from any tax charge only as long as the following circumstances apply:

Tax exempt fixed-line telephones not provided by the University:
Business use	The cost of itemized business calls only may be claimed, supported by a detailed, itemized bill. Line rental and other fixed charges are not covered by this exemption

Un-itemized packages, line-rental, etc. may be claimed for private fixed-line telephones at the discretion of the department, but this will give rise to a taxable benefit.