SE42330 - Emoluments from offices and employments: basis of assessment: the time when an emolument is received - director’s emoluments fixed before the end of the period for which they are due
Section 202B(1)(d) and (4)-(6) and Section 203A(1)(d) ICTA 1988
If the amount of a director’s emoluments for a particular
period is determined before the period ends, they are treated as
being received, and paid, at the end of that period. This rule does
not apply to employees other than directors (see
SE42260).
For example, at a shareholders’ meeting on 1 June 2000
a director is voted a special bonus of £5000 for the year
ending on 31 July 2000. Determination therefore takes place on 1
June 2000 but the emolument is treated as paid on 31 July 2000, the
end of the period for which the bonus is due.
Where a director has a service agreement which provides for a
regular monthly salary, one of the earlier “payment”
rules will usually apply before this “determination”
rule. For example, there may be an actual payment each month (see
SE42270), or the director may be entitled
to be paid each month (see
SE42290).
As regards
- fetters on payment, see SE42340
- emoluments which are dependent on results, see SE42350
- the time at which a person must be a director for this rule to apply, see SE42360.
