Background Note
10.The Government has become aware that some employers and employees have developed remuneration arrangements involving salary sacrifice or flexible benefits to take advantage of the exemption at section 317.
11.These arrangements are intended to allow some employees to purchase meals out of gross pay, and hence obtain a significant tax and National Insurance Contributions (NICs) advantage over the majority of employees who must purchase their meals using their net pay, from which tax and NICs have already been deducted.
12.This section prevents the exemption from being used in such arrangements, while ensuring it continues to apply to free or subsidised meals provided not as part of salary sacrifice or flexible benefit arrangements. This remains subject to such meals meeting the pre-existing conditions of the exemption.
