Part 5Employment income: deductions allowed from earnings
Chapter 3Deductions from benefits code earnings
Introduction
361Scope of this Chapter: cost of benefits deductible as if paid by employee
A deduction from a person’s earnings is allowed under the following provisions of this Chapter where—
(a)
the earnings include an amount treated as earnings under—
(i)
Chapter 4 of Part 3 (taxable benefits: vouchers and credit-tokens),
(ii)
Chapter 5 of Part 3 (taxable benefits: living accommodation), or
(iii)
Chapter 10 of Part 3 (taxable benefits: residual liability to charge), and
(b)
an amount in respect of the benefit in question would be deductible under Chapter 2 or 5 of this Part if the person had incurred and paid it.
Deductions where amounts treated as earnings under the benefits code
362Deductions where non-cash voucher provided
(1)
A deduction from earnings is allowed if—
(a)
the earnings include an amount treated as earnings under section F187(1) or 87A(1) (amount in respect of benefit of non-cash voucher treated as earnings),
(b)
the voucher is exchanged for goods or services (whether in the tax year or a later year), and
(c)
had the employee incurred and paid the cost of the goods or services in the tax year, the whole or part of the amount paid would have been deductible from the earnings under Chapter 2 or 5 of this Part.
(2)
The deduction is equal to the lesser of—
(a)
the amount treated as earnings, and
(b)
the amount that would have been so deductible.
363Deductions where credit-token provided
(1)
A deduction from earnings is allowed if—
(a)
the earnings include an amount treated as earnings under section F294(1) or 94A(1) (amount in respect of benefit of credit-token treated as earnings), and
(b)
had the employee incurred and paid the cost of the goods or services obtained by using the token, the whole or part of the amount paid would have been deductible from the earnings under Chapter 2 or 5 of this Part.
(2)
The deduction is equal to the lesser of—
(a)
the amount treated as earnings, and
(b)
the amount that would have been so deductible.
364Deductions where living accommodation provided
(1)
A deduction from earnings is allowed if—
(a)
the earnings include an amount treated as earnings under Chapter 5 of Part 3 (taxable benefits: living accommodation), and
(b)
had the employee incurred and paid an amount equal to that amount for the accommodation in the tax year, the whole or part of the amount paid would have been deductible under Chapter 2 or 5 of this Part.
(2)
The deduction is equal to the amount that would have been so deductible.
365Deductions where F3certain employment-related benefits provided
(1)
A deduction from earnings is allowed if—
(a)
the earnings include an amount treated as earnings under Chapter 10 of Part 3 (taxable benefits: residual liability to charge) in respect of a benefit, F4...
F5(aa)
the cost of the benefit was determined under section 204 or 206, and
(b)
had the employee incurred and paid the cost of the benefit, the whole or part of the amount paid would have been deductible under Chapter 2 or 5 of this Part.
(2)
The deduction is equal to the amount that would have been so deductible.
(3)
For the purposes of this section, the cost of the benefit is determined in accordance with F6section 204 or 206 .