What is ‘taxed at source’?

If a benefit is ‘taxed at source’ it means that the benefit you receive has already had the Benefit-in-Kind tax taken off. In terms of Benefit in Kind, it means that employees don’t have to notify the tax office about their salary sacrifice car. If an organisation doesn’t ‘tax at source’ employees will need to ensure the tax office is notified about their car and they will then have the benefit in kind tax deducted via their PAYE Coding Notice.