Income and Corporation Taxes Act 1988

141 Non-cash vouchers. U.K.

(1) M1 Subject to the following provisions of this section and section 157(3), where a non-cash voucher provided for an employee by reason of his employment is received by the employee, then, for the purposes of the Income Tax Acts—

(a) he shall be treated as having received in the relevant year of assessment an emolument from his employment of an amount equal to the expense incurred by the person providing the voucher in or in connection with the provision of the voucher and the money, goods or services for which it is capable of being exchanged; and

(b) any money, goods or services obtained by the employee or any other person in exchange for the voucher shall be disregarded;

and the expense incurred as mentioned in paragraph (a) above by the person providing the voucher is referred to below as “the chargeable expense”.

(2) In subsection (1)(a) above “the relevant year of assessment” means—

(a) in relation to a cheque voucher, the year of assessment in which the voucher is handed over in exchange for money, goods or services (a voucher which is posted being treated as handed over at the time of posting); and

(b) in relation to any other non-cash voucher, the year of assessment in which the chargeable expense is incurred or, if later, the year of assessment in which the voucher is received by the employee.

(3) M2 There shall be deductible under section 198, 201 or 332(3) from the amount taxable under subsection (1) above such amounts, if any, as would have been so deductible if the cost of the goods or services in question had been incurred by the employee out of his emoluments.

(4) M3 The chargeable expense shall be treated as reduced by any part of that expense made good to the person incurring it by the employee.

(5) M4 Where a non-cash voucher provided for an employee by reason of his employment is appropriated to him (whether by attaching it to a card held for him or in any other way), subsections (1) and (2) above shall have effect as if the employee had received the voucher at the time when it was so appropriated.

(6) [M5 Subsection (1)] above shall not apply in relation to a transport voucher provided for an employee of a passenger transport undertaking under arrangements in operation on 25th March 1982 and intended to enable that employee or a relation of his to obtain passenger transport services provided by—

(a) his employer;

(b) a subsidiary of his employer;

(c) a body corporate of which his employer is a subsidiary; or

(d) another passenger transport undertaking.

[F1 (6A) Subsection (1) above shall not apply in relation to a non-cash voucher to the extent that it is used by the employee to obtain the use of a car parking space at or near his place of work.]

[F2 (6B) Subsection (1) above shall not apply in relation to any non-cash voucher to the extent that it is used to obtain entertainment (includinxg hospitality of any kind) for the employee or a relation of his, if—

(a) the person providing the non-cash voucher is neither his employer nor a person connected with his employer;

(b) neither his employer nor a person connected with his employer has directly or indirectly procured the provision of the entertainment; and

(c) the entertainment is not provided either in recognition of particular services which have been performed by him in the course of his employment or in anticipation of particular services which are to be so performed by him;

and section 839 shall apply for determining whether persons are connected for the purposes of this subsection.]

(7) M6 In this section—

• “cheque voucher” means a cheque provided for an employee and intended for use by him wholly or mainly for payment for particular goods or services or for goods or services of one or more particular classes; and, in relation to a cheque voucher, references to a voucher being exchanged for goods or services shall be construed accordingly;

• “passenger transport undertaking” means an undertaking whose business consists wholly or mainly in the carriage of passengers and includes a subsidiary of such an undertaking;

• “subsidiary” means a wholly owned subsidiary within the meaning of section [F3 736] of the M7 Companies Act 1985;

• “transport voucher” means any ticket, pass or other document or token intended to enable a person to obtain passenger transport services (whether or not in exchange for it) and, in relation to a transport voucher, references to a voucher being exchanged for services shall be construed as references to it being exchanged for, or otherwise being used to procure, services; and

• “non-cash voucher” does not include a cash voucher within the meaning of section 143 but, subject to that, means any voucher, stamp or similar document or token capable of being exchanged (whether singly or together with other such vouchers, stamps, documents or tokens and whether immediately or only after a time) for money, goods or services (or for any combination of two or more of those things) and includes a transport voucher and a cheque voucher.

Textual Amendments

F1 1988(F) s.46(1)for 1988-89and subsequent years. Previously

“subsections (1) and 2”

in subs. (6).

F2 1988(F) s.47(1)for 1988-89and subsequent years. For 1987-88see 1988(F) s.47.

F3 Companies Act 1989 (c.40) s.144(4)and Sch.18 para.46on and after 1November 1990by virtue of S.I. 1990 No.1392 (c.41) (art.2(d)) (not reproduced).Previously

“736(5)(b)”.

Modifications etc. (not altering text)

C1 See S.I. 1973 No.334, regn.31(d) (in Part III Vol.5)—returns by employers.

C2 S. 141(6) modified (with effect in accordance with Sch. 24 para. 27(14) of the modifying Act) by Finance Act 1994 (c. 9), Sch. 24 para. 27(3)(4)

C3 See 1990 s.56and Sch.10 para.23—convertible securities.

Marginal Citations

M1 Source—1975 (No.2) s.36(1); 1982 s.44(2)

M2 Source—1975 (No.2) s.36(2); 1982 s.44(3)

M3 Source—1975 (No.2) s.36(2A); 1981 s.70(2)

M4 Source—1975(2) s.36(3)

M5 Source—1975 (No.2) s.36(3A); 1982 s.44(4)

M6 Source—1975 (No.2) s.36(4); 1982 s.44(5)

M7 1985 c. 6.