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SCHEDULE 3U.K. PAYMENTS TO BE DISREGARDED IN THE CALCULATION OF EARNINGS FOR THE PURPOSES OF EARNINGS-RELATED CONTRIBUTIONS

PART VU.K. CERTAIN NON-CASH VOUCHERS TO BE DISREGARDED AS PAYMENTS IN KIND

1.—(1) Subject to sub-paragraph (2), a non-cash voucher provided, to or for the benefit of the employed earner, by the employer or any other person on his behalf is to be disregarded in the calculation of an employed earner’s earnings by virtue of paragraph 1 of Part II only if it falls within any of paragraphs 2 to 8.U.K.

[F1(2) A non-cash voucher may also be disregarded—

(a)by virtue of paragraph 7D of Part VIII (car fuel); or

(b)in the circumstances specified in paragraph 4 of Part X (payments by way of [F2incidental overnight expenses]).]

Textual Amendments

2.  A non-cash voucher which is not treated as [F3general earnings] from employment for the purposes of [F4section 86 of ITEPA 2003 (transport vouchers under pre-26th March arrangements).]U.K.

Textual Amendments

[F5This paragraph only applies in the case of an employee who is in lower paid employment, within the meaning of section 217 of ITEPA 2003]

Textual Amendments

[F63.  A non-cash voucher exempted from liability to income tax under Chapter 4 of Part 3 by virtue of sections 266(1)(a) or 269 of ITEPA 2003 (exemptions: non-cash vouchers and credit-tokens).]U.K.

Textual Amendments

F6. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

Textual Amendments

F64.  . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .U.K.

Textual Amendments

[F75.  A non-cash voucher in respect of which no liability to income tax arises by virtue of section 266(1) of ITEPA 2003 to the extent that the voucher is used to obtain anything the direct provision of which would fall within any of the following provisions of that Act—U.K.

(a)section 246 (transport between work and home for disabled employees: general);

(b)section 247 (provision of cars for disabled employees);

(c)section 248 (transport home: late night working and failure of car-sharing arrangements).

Textual Amendments

5A.  A non-cash voucher in respect of which no liability to income tax arises by virtue of section 266(2) of ITEPA 2003 if the voucher evidences entitlement to use anything the direct provision of which would fall within any of the following provisions of that Act—U.K.

(a)section 242 (works transport services);

(b)section 243 (support for public bus services);

(c)section 244 (cycles and cyclist’s safety equipment).

Textual Amendments

5B.  A non-cash voucher in respect of which no liability to income tax arises by virtue of section 266(3) of ITEPA 2003 if the voucher can be used only to obtain anything the direct provision of which would fall within any of the following provisions of that Act—U.K.

(a)section 245 (travelling and subsistence during public transport strikes);

(b)section 261 (recreational benefits);

(c)section 264 (annual parties and functions);

(d)section 296 (armed forces' leave travel facilities);

(e)section 317 (subsidised meals).

Textual Amendments

6.  A non-cash voucher to the extent that no liability to income tax arises by virtue of any of the following sections of ITEPA 2003—U.K.

(a)section 270 (exemption for small gifts of vouchers and tokens from third parties);

(b)section 305 (offshore oil and gas workers: mainland transfers);

(c)section 321 (suggestion awards);

(d)section 323 (long service awards);

(e)section 324 (small gifts from third parties).]

Textual Amendments

[F8Meal vouchersU.K.

6A.  15 pence per working day up to a maximum of £1.05 per week of the value of one or more non-cash vouchers which can only be exchanged for meals.]

Textual Amendments

[F9Qualifying childcare vouchersU.K.

Textual Amendments

7.—(1) A qualifying childcare voucher, subject to the qualifications in sub-paragraphs (2) and (5).U.K.

(2) Where the chargeable expense of the voucher exceeds the exempt amount, only that amount shall be disregarded by virtue of sub-paragraph (1).

(3) The exempt amount is the amount found by the formula—

Here—

E is the sum of—

(a)

£50; and

(b)

the administration costs for the qualifying childcare voucher;

QW is the number of qualifying weeks—

(a)

for which the earner has been employed by the secondary contributor during the tax year in which the qualifying childcare voucher is provided; and

(b)

for which no other qualifying childcare voucher has been provided by the secondary contributor.

(4) Where an earner has two or more employed earner's employments, the earnings from which fall to be aggregated in accordance with regulation 14 or 15, the reference to the secondary contributor in paragraph (b) of the definition of QW is a reference to the secondary contributor in respect any of those employments.

(5) An earner is only entitled to one exempt amount even if childcare vouchers are provided in respect of more than one child.

(6) For the purposes of this paragraph—

(a)“chargeable expense” has the meaning given in paragraph 14 of Schedule 2;

(b)“qualifying childcare voucher” and “qualifying week” have the meanings given in section 270A of the Income Tax (Earnings and Pensions) Act 2003;

(c)the administration costs for a voucher means the difference between the cost of provision of a voucher and its face value; and

(d)the face value of a voucher is the amount stated on or recorded in the voucher as the value of the provision of care for a child that may be obtained by using it.]

Textual Amendments

For the purposes of this paragraph child care includes—

(a)care provided in accordance with the provisions of [F10Part 10(2) or 10A] of the Children Act 1989 (child minding and day care for young children)F11;

(b)in the case of a child aged 8 or over, care provided by a child minder;

(c)in the case of a child under the age of 8, care provided by a child minder where that care does not exceed, in total, two hours a day;

(d)care provided by a nanny or a relative (within the meaning respectively of section 71(13) and 105(1) of the Children Act 1989);

(e)care provided during out-of-school hours or during school holidays; and

(f)full-time and part-time care.

(2) In the application of sub-paragraph (1) to Northern Ireland—

(a)paragraph (b) shall have effect with the subtitution for “aged 8 or over” of “ aged 12 or over ”; and

(b)paragraph (c) shall have effect with the substitution for “under the age of 8” of “ under the age of 12 ”.

Textual Amendments

F111989 c. 41: Schedule 9 was amended by section 116 of the Courts and Legal Services Act 1990 (c. 41) and section 582(1) of the Education Act 1996 (c. 56).

8.  A non-cash voucher provided to or for the benefit of an employed earner in respect of employed earner’s employment by a person who is not the secondary contributor in respect of the provision of that voucher.U.K.