NIM02464 - Class 1: Vouchers - non-cash vouchers - calculation of the amount of earnings - the chargeable expense - voucher provided for two or more employees

Regulation 24 and paragraph 15 of Schedule 2 Social Security (Contributions) Regulations 2001

NIM02461 explains how to calculate the amount of earnings included in any payment made by way of a non-cash voucher (see NIM02413). But where a non-cash voucher is provided to two or more employees, the amount of earnings is to be calculated or estimated as follows:

Proportion of the benefit of the voucher for each employee is known at the time of payment

The amount of earnings for each employee is:

• an amount equal to the proportion of the benefit of the voucher;
• less any amount made good by the employee.

Proportion of the benefit of the voucher for each employee is not known at time of payment

The amount of earnings for each employee is:

• an amount equal to the chargeable expense divided equally between the number of employees concerned;
• less any amount made good by the employee.

For examples illustrating the above calculations, see NIM02465.

For income tax purposes, the method of apportioning the chargeable expense is not the same as the above. For details, see EIM16160.