EIM30002 – Benefits: scholarships
provided for members of the family or household of a director or
employee: extended meaning of "by reason of employment"
Section 212 ITEPA 2003
A scholarship is provided "by reason of a person’s
employment" if:
- it falls within the ordinary meaning of those
words (see
EIM20503), or
- it was provided by the person's employer (see
EIM20502), or
- it was provided under arrangements entered into
by his employer or a person connected with his employer whether or
not the arrangements require the employer or a connected person to
contribute directly or indirectly to the cost of providing the
scholarship.
"Connected person" has the meaning given in Section 839 ICTA
1988 (see
CG14580 onwards).
Many scholarship schemes take the form of educational trusts
set up by the employer or a third party. They are arrangements,
which can give rise to chargeable benefits. They do so if
scholarships are awarded to an individual who is a member of a
director's or employee's family or household by reason of the
employment of that director or employee.
