EIM20111 – The benefits code: employee with employment for only part of a year

When working out whether an employment has earnings of less than £8,500 a year ( EIM20101):

• if an employment, other than as a director, begins or ends during the year, convert the earnings for the part year to an annual rate in order to decide whether or not it is an excluded employment ( EIM20007)
• for example, if an employee commenced work on 6 January and earned £2,500 by 5 April, the earnings at an annual rate are £10,000 (4 x £2,500). Hence this is not an excluded employment and the benefits code applies to the employment in full ( EIM20006).