SE21120 - Benefits: what is meant by "making good"

Section 156(1) ICTA 1988

"Making good" simply means giving something in return for the benefit. What is being made good is the expense incurred by the employer or other person providing the benefit. It follows that in order to make good that expense the employee will give money, or something which can be measured in money. Usually the employee will "make good":

• by a direct payment or
• by deduction from salary or
• by a suitable debit to the employee's current account in the employer's books and records.

Any of these methods is acceptable.

The giving of services by the employee, or anything that is not measured in money terms is not "making good" - see Stones v Hall 60 TC 737. In any case where the taxpayer argues that an interest-free loan has been made to his employer specifically to make good the cost or value of a benefit, make a submission to Employment Income Technical.

As regards "making good" by waiver of remuneration see SE21122.