NIM02438 - Class 1: vouchers - non-cash vouchers - exemptions - provided by third party other than employer

Section 10ZB Social Security Contributions & Benefits Act 1992

Regulation 25 and paragraph 8 of Part 5 of Schedule 3 Social Security (Contributions) Regulations 2001

NIM02416 shows the types of non-cash voucher (see NIM02413) that are specifically disregarded in calculating an employee’s earnings for Class 1 NICs purposes. Since 6th April 2000, where from that date:

• a third party provides an employee, irrespective of the level of their earnings, with a non-cash voucher, and
• that provision has not been arranged or facilitated by the employer,

then:

• the non-cash voucher is disregarded for Class 1 NICs purposes; but
• a Class 1A NICs liability will arise on the cost of the provision of the non-cash voucher. See NIM16357 for guidance on the Class 1A NICs position.

The following table summarises the position of third-party provision from April 1999.

Tax year	Class 1 liability?	Class 1A liability?	Liable party?	Further information
1999/00	Yes	No	Employer	NIM02412
2000/01	No	Yes	Employer, but the third party may choose to pay if it wishes	NIM16350 - NIM16366
2001/02 onwards	No	Yes	Third party	NIM16350 - NIM16366