It is quite common for employers to lease assets such as motor
cars and television sets for use by employees.
The benefit to the employee does not count as earnings within
Section 62 ITEPA 2003 because the employee is not able to convert
it into money (see
EIM00520 onwards). However, directors
and employees who are not in lower paid employment are chargeable
under the benefits code (see
EIM21732 and
EIM21630 to EIM21632).
If the leasing arrangement provides for the asset to be sold
to the employee by the leasing company at the end of the leasing
period, the amount that the employee has to pay may be less than
the market value of the asset at that time. In that case, the
difference is taxable as earnings within Section 62 ITEPA 2003 (see
EIM00540).
