Part 4Employment income: exemptions

Chapter 5Exemptions: recreational benefits

Recreational facilities

261Exemption of recreational benefits

1

No liability to income tax arises in respect of the provision to an employee or a member of an employee’s family or household of benefits within subsection (2).

2

The benefits are—

a

sporting or other recreational facilities which meet conditions A to C, and

b

a right or opportunity to make use of such facilities.

This is subject to section 262.

3

Condition A is that the facilities are available generally to the employees of the employer in question.

4

Condition B is that they are not available to members of the public generally.

5

Condition C is that they are used wholly or mainly by persons whose right or opportunity to use them is employment-related (whether or not by reference to the same employer).

6

A person’s right or opportunity to use facilities is “employment-related” if and only if—

a

it derives from the person being—

i

an employee or former employee, or

ii

a member or former member of the family or household of an employee or former employee,

of a particular employer, and

b

the facilities are provided so as to be available generally to that employer’s employees.

262Benefits not exempted by section 261

1

Section 261 (exemption of recreational benefits) does not apply to the following benefits—

a

an interest in or the use of any of the following—

i

a mechanically propelled vehicle,

ii

holiday or other overnight accommodation, or

iii

facilities which include, or are provided in association with, a right or opportunity to make use of holiday or overnight accommodation,

b

facilities provided on domestic premises, or

c

a right or opportunity to make use of facilities within paragraph (a) or (b).

2

In this section—

  • “domestic premises” means—

    1. a

      premises used wholly or mainly as a private dwelling, or

    2. b

      land or other premises belonging to, or enjoyed with, premises so used, and

  • “vehicle” includes a ship, boat or other vessel, an aircraft and a hovercraft.

263Power to alter benefits to which section 261 applies

The Treasury may by regulations provide that section 261—

a

does not apply to a benefit specified in the regulations,

b

applies to a benefit so specified only where such conditions as the regulations specify are met in relation to the terms on which, and the persons to whom, it is provided, or

c

applies in such cases as are so specified to—

i

facilities that do not meet the conditions in section 261(3) to (5), or

ii

a benefit within section 262.