PAYE72035 - PAYE operation: payments for PAYE purposes: non-cash remuneration
Readily convertible assets
Section 696 ITEPA 2003 requires employers to operate PAYE where they remunerate employees in the form of a readily convertible asset. The amount that is treated as PAYE income for the purpose of operating PAYE, is the best estimate that can reasonably be made of the amount of income likely to be PAYE income in respect of the provision of the asset.
Section 702 ITEPA 2003 defines the meaning of ‘readily convertible asset’ and the Employment Income Manual at EIM11900 onwards, gives information on the different types of readily convertible asset.
Ordinary benefits
The treatment of ordinary benefits in kind (for example cars, private health insurance, employee’s private expenses met by the employer), remain outside the scope of PAYE and must be reported to HMRC by the employer on form P9D / P11D.
National Insurance Contributions
Advice regarding National Insurance Contributions on non-cash remuneration should be sought from HMRC NICO. Enquiries from employers / agents should be referred to the NIC Employer Helpline: 0845 714 3143.
