SE21715 - Benefits: gifts in kind from third parties
Extra Statutory Concession A70
The guidance at
SE01450 onwards applies to gifts and
other voluntary payments to directors and employees within Part V
Chapter II ICTA 1988. But a gift may be exempt from tax under
Extra- Statutory Concession A70 if it is a gift of goods (or a
voucher or token only capable of being used to obtain goods) made
by someone other than the employer.
The text of the concession is as follows:
“Income Tax is not charged under any of the provisions of Schedule E on a gift received by an employee or office holder if all the following conditions are satisfied:
- the gift consists of goods or a voucher or token only capable of being used to obtain goods
- the person making the gift is not the employer (or a person connected with the employer)
- the gift is not made either in recognition of the performance of particular services in the course of the employment or in anticipation of particular services which are to be performed
- the gift has not been directly or indirectly procured by the employer (or by a person connected with the employer)
- the total cost of all gifts made by the same donor to the employee during the income tax year is £150 or less.
For the purposes of this concession:
- a gift made to a member of an employee’s family or household will be treated as a gift made to the employee
- the cost to the person making the gift includes any VAT paid whether or not it is reclaimable
- whether persons are connected will be determined in accordance with Section 839 ICTA 1988
- “family or household” will be determined in accordance with Section 168(4) ICTA 1988.
Where the cost of a gift (or gifts) an employee receives from the same third party donor in an income tax year exceeds £150 tax will be payable on the full amount assessable under the relevant charging provision.”
Note that the concession does not apply to:
