SE16025 - Vouchers and credit-tokens: outline of the special rules - page 2

Sections 141, 142, 143 and 198 ICTA 1988

This page summarises circumstances when there is no charge to tax on the employee. This is even though the employee has used a voucher or token provided by reason of the employment to obtain goods or services.

For a description of the points to consider in a case involving vouchers or credit-tokens see SE16030.

For a description of what is caught by the legislation see SE16020.

Having obtained money, goods or services by means of a voucher or credit-token supplied by reason of his employment, the employee can only escape a charge to tax if

• The employee reimburses the provider for those costs or
• The cost of both the voucher or credit-token and the items obtained by its use was incurred in such circumstances that, had the employee incurred it, there would be a deduction for it under Section 198 ICTA 1988 or
• The terms of Extra Statutory Concession ESC A70 relating to small gifts of goods by third parties, are satisfied - see SE01460, or
• There is a statutory exemption – see SE16070, SE16100 and SE50100, or
• The terms of Extra Statutory concession ESC A74 relating to meals provided for employees are satisfied – see SE21670.

Thus if an employer supplies an employee with a credit card only to obtain necessary items for use by the employee in the performance of the duties and the employer pays the bills, no charge to tax will result.