EMPLOYEES will no longer have to pay tax for taking advantage of subsidised, employer-sponsored buses to work.

Workers had faced tax charges for subsidising green commuter schemes, with companies including Boots hit by tax bills reaching hundreds of thousands of pounds a year for providing bus services to staff as an alternative to commuting by car to ease congestion.

Already, use of buses with more than 10 seats had been exempt from the benefit-in-kind tax charge.

And under new rules announced by the Inland Revenue and effective from April 6 this year, this threshold is to be extended to minibuses with between 9 and 11 passenger seats.

In addition, where an employer subsidises a local bus company to provide employees with free or reduced fares, there is no longer any tax or NIC charge.