SE20504 - Benefits: provided for an employee's family or household

Sections 154(1) and Section 168(3) and (4) ICTA 1988

A benefit provided for a member of an employee's family or household, whether by his employer or someone else, is chargeable on him under Part V Chapter II ICTA 1988 if it is provided by reason of his employment.

If the benefit is provided by the employee's employer it is deemed to be provided by reason of the employment and the guidance at SE20502, including the exception mentioned there, applies.

'Family or household' means

the employee's spouse

• the employee's children and their spouses
• the employee's parents
• the employee's dependants
• the employee's servants and
• the employee's guests (that is people staying at his invitation in his home or in accommodation provided by him).

Thus an employee who takes his family away on holiday at his employer's expense is chargeable not only on the cost of his own holiday fares and accommodation but also on the cost of those relating to his wife and family.

Different rules apply where the benefit is a beneficial loan ( SE26112) or the acquisition of shares at an undervalue (Share Scheme Manual 6005).