This guide explains your tax and National Insurance contributions (NICs) obligations if you provide your employees with meals, vouchers for meals or payments to cover the cost of meals.
On this page:
Covers free or subsidised meals of reasonable scale that you make available to all your employees, or to all your employees at a particular location and which are not provided under salary sacrifice or flexible remuneration arrangements.
The meals don't have to be provided on your premises, but if they're provided elsewhere it must be at a canteen that's open to all your employees. For example, an industrial estate might have a single canteen serving the employees of all the employers on the estate. This only applies to a canteen that's off the premises and does not apply to any other sort of food outlet, such as a café or sandwich bar.
You have:
Covers free or subsidised meals that don't meet the criteria outlined in the previous section. Examples include:
For employees earning at a rate of less than £8,500 rate per year, you have:
For company directors or employees earning at a rate of £8,500 or more per year:
The value to use is the cost to you of providing or subsidising the employee's meals.
Covers cash allowances given to an employee to cover the cost of food and drink consumed in the workplace.
These payments count as normal earnings, so:
The value to use is the amount of the cash allowance.
You have a scheme in place under which you contribute to an 'account'
that an employee uses to purchase food or drink in the workplace.
The details of this kind of scheme can vary, but the following features
are common:
Your contributions to an employee's account under a scheme like this count as earnings, so:
The value to use is the amount you contribute to the employee's account.
Only covers vouchers in the form of tickets or tokens used to obtain meals on your premises or in a canteen that’s open to all of your employees. Does not cover vouchers provided under salary sacrifice or flexible remuneration arrangements.
The meals don't have to be provided on your premises, but if they're provided elsewhere it must be at a canteen that's open to all your employees. For example, an industrial estate might have a single canteen serving the employees of all the employers on the estate.
You have:
Covers meal vouchers that aren't restricted to use in a canteen open to all your employees.
You have:
Covers meal vouchers that aren't restricted to use in a canteen open to all your employees.
For employees earning at a rate of less than £8,500 per year:
For company directors or employees earning at a rate of £8,500 or more per year:
The value to use is the amount by which the vouchers' face value exceeds 15p per day.
Covers vouchers that can be exchanged for cash as well as for meals.
These vouchers are treated in the same way as normal earnings, so:
The value to use is the amount for which the voucher can be exchanged by the employee - its cash value.
It's important to choose correctly between forms P11D and P9D for each employee. The form to use depends on the whether the employee is a director of your company and on whether their earnings are above or below an annual rate of £8,500. For more information - including details of what's included in the £8,500 threshold - follow the link below.
EIM21670: subsidised meals including canteen meals and working lunches
EIM01530: Cash allowances for meals
NIM02437: Non-cash vouchers - meals
EIM21675: Canteen arrangements - when do they count as earnings?
