93 Credit-token made available to public generally
This Chapter does not apply to a credit-token if—
(a) it is of a kind made available to the public generally, and
(b) it is provided to the employee or a member of the employee’s family on no more favourable terms than to the public generally.
(1) On each occasion on which a credit-token to which this Chapter applies is used by the employee in a tax year to obtain money, goods or services, the cash equivalent of the benefit of the token is to be treated as earnings from the employment for that year.
(2) The cash equivalent is the difference between—
(a) the cost of provision, and
(b) any part of that cost made good by the employee—
(i) to the person incurring it, and
(ii) on or before 6 July following the tax year which contains the occasion in question.
(3) In this section the “cost of provision” means the expense incurred—
(a) in or in connection with the provision of the money, goods or services obtained on the occasion in question, and
(b) by the person at whose cost they are provided.
(4) If a person incurs expense in or in connection with the provision of credit-tokens for two or more employees as members of a group or class, the expense incurred in respect of one of them is to be such part of that expense as is just and reasonable.
94A Benefit of credit-token treated as earnings: optional remuneration arrangements
(1) If the conditions in subsections (2) and (3) are met in relation to any occasions on which a credit-token to which this Chapter applies is used by the employee in a tax year to obtain money, goods or services—
(a) the relevant amount is to be treated as earnings from the employment for that year, and
(b) section 94(1) does not apply in relation to the use of the credit-token on those occasions.
(2) The condition in this subsection is that the credit-token is used pursuant to optional remuneration arrangements.
(3) The condition in this subsection is that AF is greater than the relevant cost of provision for the tax year.
In this section “AF” means so much of the amount foregone (see section 69B) as is attributable on a just and reasonable basis to the use of the credit-token by the employee in the tax year pursuant to the optional remuneration arrangements to obtain money, goods or services.
(4) The “relevant amount” is the difference between—
(a) AF, and
(b) any part of the relevant cost of provision for the tax year that is made good by the employee, to the person incurring it, on or before 6 July following the tax year which contains the occasion of use of the credit-token to which the making good relates.
(5) But the relevant amount is taken to be zero if the amount given by paragraph (b) of subsection (4) exceeds AF.
(6) For the purposes of this section the “relevant cost of provision for the tax year” is determined as follows—
Step 1 Find the cost of provision with respect to each occasion of use of the credit-token by the employee in the tax year pursuant to the optional remuneration arrangements to obtain money, goods or services.
Step 2 The total of those amounts is the relevant cost of provision for the tax year.
(7) But the relevant cost of provision for the tax year is to be taken to be zero if the condition in subsection (8) is met.
(8) The condition is that use of the credit token by the employee in the tax year pursuant to the optional remuneration arrangements to obtain money, goods or services would be exempt from income tax but for section 228A (exclusion of certain exemptions).
(9) In this section “cost of provision” has the same meaning as in section 94.
95 Disregard for money, goods or services obtained
(1) This section applies if the cash equivalent of the benefit of a cash voucher, a non-cash voucher or a credit-token or the relevant amount in respect of a cash voucher, a non-cash voucher or a credit-token —
(a) is to be treated as earnings from an employee’s employment under this Chapter, ...
(b) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(2) Money, goods or services obtained—
(a) by the employee or another person in exchange for the cash voucher or non-cash voucher, or
(b) by the employee or a member of the employee’s family by use of the credit-token,
are to be disregarded for the purposes of the Income Tax Acts.
(3) But the goods or services are not to be disregarded for the purposes of applying sections 362 and 363 (deductions where non-cash voucher or credit-token provided).
(3A) In the case of a childcare voucher, the reference in subsection (2)(a) to the services obtained in exchange for the voucher is to the provision of care for a child obtained by using it.
(4) In the case of a transport voucher, the reference in subsection (2)(a) to the services obtained in exchange for the voucher is to the passenger transport services obtained by using it.
96A Power to exempt use of non-cash vouchers or credit-tokens to obtain exempt benefits
(1) The Treasury may by regulations provide for exemption from any liability that would otherwise arise by virtue of this Chapter in respect of—
(a) non-cash vouchers which are or can be used to obtain specified exempt benefits, or which evidence an employee's entitlement to specified exempt benefits;
(b) credit-tokens which are used to obtain specified exempt benefits.
(2) In this section—
“exempt benefit” means a benefit the direct provision of which is exempted from liability to income tax by a provision of Part 4 (employment income: exemptions), and
“specified” means specified in the regulations.
(3) Regulations under this section may operate by amending section 266 (exemption of non-cash vouchers for exempt benefits) or section 267 (exemption of credit-tokens used for exempt benefits).
97 Living accommodation to which this Chapter applies
(1) This Chapter applies to living accommodation provided for—
(a) an employee, or
(b) a member of an employee’s family or household,
by reason of the employment.
(1A) Where this Chapter applies to any living accommodation—
(a) the living accommodation is a benefit for the purposes of this Chapter (and accordingly it is immaterial whether the terms on which it is provided to any of those persons constitute a fair bargain), and
(b) sections 102 to 108 provide for an amount in respect of the benefit of the living accommodation to be treated as earnings.
(2) Living accommodation provided for any of those persons by the employer is to be regarded as provided by reason of the employment unless—
(a) the employer is an individual, and
(b) the provision is made in the normal course of the employer’s domestic, family or personal relationships.
In section 102 (benefit of accommodation treated as earnings) subsection (1A) (accommodation provided otherwise than pursuant to optional remuneration arrangements) does not apply to living accommodation provided for an employee if—
(a) the employer is a local authority,
(b) it is provided for the employee by the authority, and
(c) the terms on which it is provided are no more favourable than those on which similar accommodation is provided by the authority for persons who are not their employees but whose circumstances are otherwise similar to those of the employee.
99 Accommodation provided for performance of duties
(1) In section 102 (benefit of accommodation treated as earnings) subsection (1A) (accommodation provided otherwise than pursuant to optional remuneration arrangements) does not apply to living accommodation provided for an employee if it is necessary for the proper performance of the employee’s duties that the employee should reside in it.
(2) In section 102 (benefit of accommodation treated as earnings) subsection (1A) does not apply to living accommodation provided for an employee if—
(a) it is provided for the better performance of the duties of the employment, and
(b) the employment is one of the kinds of employment in the case of which it is customary for employers to provide living accommodation for employees.
(3) But if the accommodation is provided by a company and the employee (“E”) is a director of the company or of an associated company, the exception in subsection (1) or (2) only applies if, in the case of each company of which E is a director—
(a) E has no material interest in the company, and
(b) either—
(i) E’s employment is as a full-time working director, or
(ii) the company is non-profit-making or is a charitable company.
(4) “Non-profit-making” means that the company does not carry on a trade and its functions do not consist wholly or mainly in the holding of investments or other property.
(5) A company is “associated” with another if—
(a) one has control of the other, or
(b) both are under the control of the same person.
100 Accommodation provided as result of security threat
In section 102 (benefit of accommodation treated as earnings) subsection (1A) (accommodation provided otherwise than pursuant to optional remuneration arrangements) does not apply to living accommodation provided for an employee if—
(a) there is a special threat to the security of the employee,
(b) special security arrangements are in force, and
(c) the employee resides in the accommodation as part of those arrangements.
(1) In section 102 (benefit of accommodation treated as earnings) subsection (1A) (accommodation provided otherwise than pursuant to optional remuneration arrangements) does not apply to living accommodation outside the United Kingdom provided by a company for a director or other officer of the company (“D”) or a member of D's family or household if—
(a) the company is wholly owned by D or D and other individuals (and no interest in the company is partnership property), and
(b) the company has been the holding company of the property at all times after the relevant time.
(2) The company is “the holding company of the property” when—
(a) it owns a relevant interest in the property,
(b) its main or only asset is that interest, and
(c) the only activities undertaken by it are ones that are incidental to its ownership of that interest.
(3) The company is also “the holding company of the property” when—
(a) a company (“the subsidiary”) which is wholly owned by the company meets the conditions in paragraphs (a) to (c) of subsection (2),
(b) the company's main or only asset is its interest in the subsidiary, and
(c) the only activities undertaken by the company are ones that are incidental to its ownership of that interest.
(4) “Relevant interest in the property” means an interest under the law of any territory that confers (or would but for any inferior interest confer) a right to exclusive possession of the property at all times or at certain times.
(5) “The relevant time” is the time the company first owned a relevant interest in the property; but this is subject to subsection (6).
(6) If—
(a) none of D's interest in the company was acquired directly or indirectly from a person connected with D, and
(b) the company owned a relevant interest in the property at the time D first acquired an interest in the company,
“the relevant time” is the time D first acquired such an interest.
(1) Section 100A(1) does not apply if subsection (2), (3) or (4) applies.
(2) This subsection applies if—
(a) the company's interest in the property was acquired directly or indirectly from a connected company at an undervalue, or
(b) the company's interest in the property derives from an interest that was so acquired.
(3) This subsection applies if, at any time after the relevant time—
(a) expenditure in respect of the property has been incurred directly or indirectly by a connected company, or
(b) any borrowing of the company directly or indirectly from a connected company has been outstanding (but see subsection (7)).
(4) This subsection applies if the living accommodation is provided in pursuance of an arrangement the main purpose, or one of the main purposes, of which is the avoidance of tax or national insurance contributions.
(5) In subsection (2) references to the acquisition of an interest include the grant of an interest.
(6) For the purposes of that subsection, an interest is acquired at an undervalue if the total consideration for it is less than that which might reasonably have been expected to be obtained on a disposal of the interest on the open market; and “consideration” here means consideration provided at any time (and, for example, includes payments by way of rent).
(7) For the purposes of subsection (3)(b), no account is to be taken of—
(a) any borrowing at a commercial rate, or
(b) any borrowing which results in D being treated under Chapter 7 (taxable benefits: loans) as receiving earnings.
(8) In subsection (4) “arrangement” includes any scheme, agreement or understanding, whether or not enforceable.
(9) In this section “connected company” means—
(a) a company connected with D, with a member of D's family or with an employer of D, or
(b) a company connected with such a company.
In section 102 (benefit of accommodation treated as earnings) subsection (1A) (accommodation provided otherwise than pursuant to optional remuneration arrangements) does not apply to living accommodation provided for an employee if the accommodation is—
(a) Chevening House, or
(b) any other premises held on the trusts of the trust instrument set out in the Schedule to the Chevening Estate Act 1959 (c. 49),
and the employee is a person nominated in accordance with those trusts.
102 Benefit of living accommodation treated as earnings
(1) This section applies if living accommodation to which this Chapter applies is provided in any period (“the taxable period”) —
(a) which consists of the whole or part of a tax year, and
(b) throughout which the employee holds the employment,
(1A) the cash equivalent of the benefit of the accommodation is to be treated as earnings from the employment for that year.
(1B) If the benefit of the accommodation is provided pursuant to optional remuneration arrangements—
(a) subsection (1A) does not apply, and
(b) the relevant amount is to be treated as earnings from the employment for that tax year.
(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(3) Section 103 indicates how the cash equivalent is calculated.
(4) Section 103A indicates how the relevant amount is determined.
(1) The cash equivalent is calculated—
(a) under section 105 if the cost of providing the living accommodation does not exceed £75,000; and
(b) under section 106 if the cost of providing the living accommodation exceeds £75,000.
(2) Section 104 (general rule) sets out how to calculate the cost of providing living accommodation for the purpose of determining whether or not it exceeds £75,000.
(3) In this Chapter—
“annual value”,
“person involved in providing accommodation”, and
“the property”,
have the meaning given by sections 110 to 113, and “the taxable period” has the meaning given by section 102(1) .
103A Accommodation provided pursuant to optional remuneration arrangements: relevant amount
(1) To find the relevant amount, first determine which (if any) is the greater of—
(a) the modified cash equivalent of the benefit of the accommodation (see sections 105(2A) and 106(2A)), and
(b) the amount foregone with respect to the benefit of the accommodation (see section 69B).
(2) If the amount mentioned in subsection (1)(a) is greater than or equal to the amount mentioned in subsection (1)(b), the “relevant amount” is the cash equivalent of the benefit of the accommodation (see section 103).
(3) Otherwise, the “relevant amount” is the difference between—
(a) the amount foregone with respect to the benefit of the accommodation, and
(b) the deductible amount (see subsections (7) and (8)).
(4) If the amount foregone with respect to the benefit of the accommodation does not exceed the deductible amount, the relevant amount is taken to be zero.
(5) For the purposes of subsections (1) and (2), assume that the modified cash equivalent of the benefit of the accommodation is zero if the condition in subsection (6) is met.
(6) The condition is that the benefit of the accommodation would be exempt from income tax but for section 228A (exclusion of certain exemptions).
(7) If the cost of providing the living accommodation does not exceed £75,000, the “deductible amount” means any sum made good, on or before 6 July following the tax year which contains the taxable period, by the employee to the person at whose cost the accommodation is provided that is properly attributable to its provision.
(8) If the cost of providing the living accommodation exceeds £75,000, the “deductible amount” means the total of amounts A and B where—
A is equal to so much of MG as does not exceed RV;
B is the amount of any excess rent paid by the employee in respect of the taxable period;
MG is the total of any sums made good, on or before 6 July following the tax year which contains the taxable period, by the employee to the person at whose cost the accommodation is provided that are properly attributable to its provision (in the taxable period);
RV is the rental value of the accommodation for the taxable period as set out in section 105(3) or (4A)(b) (as applicable).
(9) In subsection (8) “excess rent” means so much of the rent in respect of the taxable period paid—
(a) by the employee,
(b) in respect of the accommodation,
(c) to the person providing it, and
(d) on or before 6 July following the tax year which contains the taxable period,
as exceeds the rental value of the accommodation.
(10) Where it is necessary for the purposes of subsection (1)(b) and (3)(a) to apportion an amount of earnings to the benefit of the accommodation in the taxable period, the apportionment is to be made on a just and reasonable basis.
In this subsection “earnings” is to be interpreted in accordance with section 69B(5).
104 General rule for calculating cost of providing accommodation
For any tax year the cost of providing living accommodation is given by the formula—
A
+
1
-
P
where—
A is any expenditure incurred in acquiring the estate or interest in the property held by a person involved in providing the accommodation,
I is any expenditure incurred on improvements to the property which has been incurred before the tax year in question by a person involved in providing the accommodation, and
P is so much of any payment or payments made by the employee to a person involved in providing the accommodation as represents—
(a) reimbursement of A or I, or
(b) consideration for the grant to the employee of a tenancy or sub-tenancy of the property.
105 Cash equivalent: cost of accommodation not over £75,000
(1) The cash equivalent or modified cash equivalent is to be calculated under this section if the cost of providing the living accommodation does not exceed £75,000.
(2) The cash equivalent is the difference between—
(a) the rental value of the accommodation for the taxable period, and
(b) any sum made good , on or before 6 July following the tax year which contains the taxable period, by the employee to the person at whose cost the accommodation is provided that is properly attributable to its provision.
(2A) The modified cash equivalent is equal to the rental value of the accommodation for the taxable period.
(3) The “rental value of the accommodation” for the taxable period is (subject to subsections (4) and (4A)) the rent which would have been payable for that period if the property had been let to the employee at an annual rent equal to the annual value.
(4) Subsection (4A) applies where—
(a) a rental amount is payable by the person (“P”) at whose cost the accommodation is provided in respect of the whole or part of the taxable period (“the relevant period”), and
(b) the amount so payable is payable at an annual rate greater than the annual value.
(4A) Where this subsection applies—
(a) subsection (3) does not apply to the relevant period, and
(b) instead the “rental value of the accommodation” for the relevant period is the rental amount payable by P in respect of the relevant period.
(4B) A reference in subsection (4) or (4A) to a rental amount payable by P in respect of the relevant period is to the sum of—
(a) any rent for the period payable by P, and
(b) any amount attributed to the period in respect of a lease premium (see sections 105A and 105B).
(5) If the rental value of the accommodation for the taxable period does not exceed any sum made good by the employee as mentioned in subsection (2)(b), the cash equivalent is nil.
(1) For the purposes of section 105(4B)(b) an amount is attributed to the relevant period “in respect of a lease premium” if—
(a) the property consists of premises, or a part of premises, that are subject to a lease,
(b) the premises are not mainly used by P for a purpose other than the provision of living accommodation to which this Chapter applies,
(c) the lease is for a term of 10 years or less, and
(d) the net amount payable by P in relation to the lease by way of lease premium is greater than zero.
(2) The amount so attributed is—
AC×C
where—
A is the relevant period (in days),
B is the term of the lease (in days), and
C is the net amount payable by P in relation to the lease by way of lease premium.
(3) For provision about the application of this section in relation to certain leases with break clauses, see section 105B.
(4) For the purposes of this section the net amount payable by P in relation to a lease by way of lease premium is—
(a) the total amount (if any) that has been paid, or is or will become payable, by P in relation to the lease by way of lease premium, less
(b) any amount within paragraph (a) that has been repaid or is or will become repayable.
(5) In this section and section 105B “lease premium” means any premium payable—
(a) under a lease, or
(b) otherwise under the terms on which a lease is granted.
(6) In the application of this section to Scotland “premium” includes a grassum.
105B Lease premiums in the case of leases with break clauses
(1) This section applies to a lease (“the original lease”) that contains one or more relevant break clauses.
(2) For the purposes of this section—
(a) “break clause” means a provision of a lease that gives a person a right to terminate it so that its term is shorter than it otherwise would be, and
(b) a break clause contained in the original lease is “relevant” if the right to terminate the lease that it confers is capable of being exercised in such a way that the term of the original lease is 10 years or less.
(3) For the purposes of section 105A—
(a) the term of the original lease, and
(b) the net amount payable by P in relation to the lease by way of lease premium,
are to be determined on the assumption that any relevant break clause is exercised in such a way that the term of the lease is as short as possible.
(4) If a relevant break clause is not in fact exercised in such a way that the term of the original lease is as short as possible, the parties to the lease are treated for the purposes of section 105A as if they were parties to another lease (a “notional lease”) the term of which—
(a) begins immediately after the time at which the term of the original lease would have ended, if that break clause had been so exercised, and
(b) ends at the time mentioned in subsection (5).
(5) The term of a notional lease ends—
(a) at the time the term of the original lease would end, on the assumption that any relevant break clause that is exercisable only after the beginning of the term of the notional lease is exercised in such a way that the term of the original lease is as short as possible, or
(b) if earlier, the tenth anniversary of the beginning of the term of the original lease.
(6) For the purposes of section 105A the net amount payable by P in relation to a notional lease by way of lease premium is, in the case of a notional lease the term of which ends under paragraph (a) of subsection (5)—
(a) the net amount that would be payable by P in relation to the original lease by way of lease premium on the assumption mentioned in that paragraph, less
(b) any part of that amount that has already been attributed to a period in respect of a lease premium under section 105(4B)(b).
(7) For the purposes of section 105A the net amount payable by P in relation to a notional lease by way of lease premium is, in the case of a notional lease the term of which ends under paragraph (b) of subsection (5), the relevant proportion of—
(a) the net amount that would be payable by P in relation to the original lease by way of lease premium, on the assumption that no break clause is exercised, less
(b) any part of that amount that has already been attributed to a period in respect of a lease premium under section 105(4B)(b).
(8) In subsection (7) “the relevant proportion” means—
DE
where—
D is the term of the notional lease (in days), and
E is the sum of—
(a) the term of the notional lease (in days), and
(b) the number of days by which the term of the original lease would exceed 10 years, on the assumption that no break clause is exercised.
106 Cash equivalent: cost of accommodation over £75,000
(1) The cash equivalent or modified cash equivalent is calculated under this section if the cost of providing the living accommodation exceeds £75,000.
(2) To calculate the cash equivalent—
Step 1
Calculate the amount that would be the cash equivalent if section 105 applied (cash equivalent: cost of accommodation not over £75,000).
Step 2
Calculate the following amount (“the additional yearly rent”)—
ORI
×
(
C
-
£75,000
)
where—
ORI is the official rate of interest in force for the purposes of Chapter 7 of this Part (taxable benefits: loans) on 6th April in the tax year, and
C is the cost of providing the accommodation calculated—
(a) in accordance with section 104 (general rule for calculating cost of accommodation), or
(b) in a case where section 107 applies (special rule for calculating cost of providing accommodation), in accordance with that section instead.
Step 3
Calculate the rent which would have been payable for the taxable period if the property had been let to the employee at the additional yearly rent calculated under step 2.
Step 4
Calculate the cash equivalent by—
(a) adding together the amounts calculated under steps 1 and 3, and
(b) (if allowed by subsection (3)) subtracting from that total the excess rent paid by the employee.
(2A) To calculate the modified cash equivalent—
(a) apply steps 1 to 3 in subsection (2), as if the words “cash equivalent” in step 1 were “modified cash equivalent (for the purposes of section 105)”;
(b) calculate the modified cash equivalent by adding together the amounts calculated under steps 1 and 3 as applied by paragraph (a).
(3) In step 4—
(a) paragraph (b) only applies if, in respect of the taxable period, the rent paid—
(i) by the employee,
(ii) in respect of the accommodation,
(iii) to the person providing it, and
(iv) on or before 6 July following the tax year which contains the taxable period,
exceeds the rental value of the accommodation for that period as set out in section 105(3) or (4)(b), as applicable, and
(b) “the excess rent” means the total amount of that excess.
107 Special rule for calculating cost of providing accommodation
(1) This section contains a special rule for calculating the cost of providing living accommodation which—
(a) operates for the purposes of step 2 of section 106(2) (calculating the additional yearly rent), and
(b) accordingly only operates where the cost of provision for the purposes of section 106(1) (as calculated under section 104) exceeds £75,000.
(2) This section applies if, throughout the period of 6 years ending with the date when the employee first occupied the accommodation (“the initial date”), an estate or interest in the property was held by a person involved in providing the accommodation.
It does not matter whether it was the same estate, interest or person throughout.
(3) For any tax year the cost of providing the living accommodation for the purposes mentioned in subsection (1)(a) is given by the formula—
MV
+
I
-
P
where—
MV is the price which the property might reasonably be expected to have fetched on a sale in the open market with vacant possession as at the initial date,
I is any expenditure incurred on improvements to the property which has been incurred during the period—
(a) beginning with the initial date, and
(b) ending with the day before the beginning of the tax year,
by a person involved in providing the accommodation, and
P is so much of any payment or payments made by the employee to a person involved in providing the accommodation as represents—
(a) reimbursement (up to an amount not exceeding MV) of any expenditure incurred in acquiring the estate or interest in the property held on the initial date,
(b) reimbursement of I, or
(c) consideration for the grant to the employee of a tenancy or sub-tenancy of the property.
(4) In estimating MV no reduction is to be made for an option in respect of the property held by—
(a) the employee,
(b) a person connected with the employee, or
(c) a person involved in providing the accommodation.
108 Cash equivalent: accommodation provided for more than one employee
(1) If, for the whole or part of a tax year, the same living accommodation is provided for more than one employee at the same time, the total of the cash equivalents for all of the employees is to be limited to the amount that would be the cash equivalent if the accommodation was provided for one employee.
(2) The cash equivalent for each of the employees is to be such part of that amount as is just and reasonable.
109 Priority of this Chapter over Chapter 1 of this Part
(1) This section applies if—
(a) under this Chapter an amount is to be treated as earnings from an employee’s employment for a tax year, and
(b) under Chapter 1 of this Part an amount would, apart from this section, constitute earnings from the employment for the year in respect of the provision of the accommodation.
(2) The full amount mentioned in subsection (1)(a) is to be treated as earnings from the employment for that year under this Chapter.
(3) The amount mentioned in subsection (1)(b) is to constitute earnings from the employment for the year under Chapter 1 of this Part only to the extent that it exceeds the amount mentioned in subsection (2).
(4) In a case where the amount mentioned in subsection (1)(a) is nil—
(a) subsections (2) and (3) do not apply, and
(b) the full amount mentioned in subsection (1)(b) constitutes earnings from the employment for the year under Chapter 1.
(1) For the purposes of this Chapter the “annual value” of living accommodation is the rent which might reasonably be expected to be obtained on a letting from year to year if—
(a) the tenant undertook to pay all taxes, rates and charges usually paid by a tenant, and
(b) the landlord undertook to bear the costs of the repairs and insurance and the other expenses (if any) necessary for maintaining the property in a state to command that rent.
(2) For the purposes of subsection (1) that rent—
(a) is to be taken to be the amount that might reasonably be expected to be so obtained in respect of the letting of the accommodation, and
(b) is to be calculated on the basis that the only amounts that may be deducted in respect of services provided by the landlord are amounts in respect of the cost to the landlord of providing any relevant services.
(3) If living accommodation is of a kind that might reasonably be expected to be let on terms under which—
(a) the landlord is to provide any services which are either—
(i) relevant services, or
(ii) the repair, insurance or maintenance of any premises which do not form part of the accommodation but belong to or are occupied by the landlord, and
(b) amounts are payable in respect of the services in addition to the rent,
the rent to be established under subsection (1) in respect of the accommodation is to be increased under subsection (4).
(4) That rent is to include—
(a) where the services are relevant services, so much of the additional amounts as exceeds the cost to the landlord of providing the services;
(b) where the services are within subsection (3)(a)(ii), the whole of the additional amounts.
(5) In this section “relevant service” means a service other than the repair, insurance or maintenance of the accommodation or of any other premises.
(1) This section applies if there is a dispute as to the amount of the annual value of living accommodation for the purposes of this Chapter.
(2) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(3) An application for the tribunal to determine the question is to be subject to the relevant provisions of Part 5 of TMA 1970 (see, in particular, section 48(2)(b) of that Act), and each of the persons concerned is entitled to be a party to the proceedings on the application.
112 Meaning of “person involved in providing the accommodation”
For the purposes of this Chapter “person involved in providing the accommodation” means any of the following—
(a) the person providing the accommodation;
(b) the employee’s employer (if not within paragraph (a));
(c) any person, other than the employee, who is connected with a person within paragraph (a) or (b).
(1) This Chapter applies to a car or a van in relation to a particular tax year if in that year the car or van—
(a) is made available (without any transfer of the property in it) to an employee or a member of the employee’s family or household,
(b) is so made available by reason of the employment (see section 117), and
(c) is available for the employee’s or member’s private use (see section 118).
(1A) Where this Chapter applies to a car or van, the car or van is a benefit for the purposes of this Chapter (and accordingly it is immaterial whether the terms on which it is made available to the employee or member constitute a fair bargain).
(2) Where this Chapter applies to a car or van—
(a) sections 120 to 148 provide for an amount in respect of the benefit of the car to be treated as earnings,
(b) sections 149 to 153 provide for an amount in respect of the benefit of any fuel provided for the car to be treated as earnings, ...
(c) sections 154 to 159 provide for an amount in respect of the benefit of the van to be treated as earnings; and
(d) sections 160 to 164 provide for an amount in respect of the benefit of any fuel provided for the van to be treated as earnings in certain circumstances.
(3) . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
(3A) This Chapter does not apply to a van in relation to a tax year if the private use of the van during the tax year by the employee or member of the employee’s family or household is insignificant.
(4) The following provisions of this Chapter provide for further exceptions—
section 167 (pooled cars);
section 168 (pooled vans);
section 169 (car available to more than one member of family or household employed by same employer).
section 169A (van available to more than one member of family or household employed by same employer).
(1) In this Chapter—
“car” means a mechanically propelled road vehicle which is not—
a goods vehicle,
a motor cycle,
an invalid carriage, or
a vehicle of a type not commonly used as a private vehicle and unsuitable to be so used;
“van” means a mechanically propelled road vehicle which—
is a goods vehicle, and
has a design weight not exceeding 3,500 kilograms,
and which is not a motor cycle.
(2) For the purposes of subsection (1)—
“design weight” means the weight which a vehicle is designed or adapted not to exceed when in normal use and travelling on a road laden;
“goods vehicle” means a vehicle of a construction primarily suited for the conveyance of goods or burden of any description;
“invalid carriage” has the meaning given by section 185(1) of the Road Traffic Act 1988 (c. 52);
“motor cycle” has the meaning given by section 185(1) of the Road Traffic Act 1988.
116 Meaning of when car or van is available to employee
(1) For the purposes of this Chapter a car or van is available to an employee at a particular time if it is then made available, by reason of the employment and without any transfer of the property in it, to the employee or a member of the employee’s family or household.
(2) References in this Chapter to—
(a) the time when a car or van is first made available to an employee are to the earliest time when the car or van is made available as mentioned in subsection (1), and
(b) the last day in a year on which a car or van is available to an employee are to the last day in the year on which the car or van is made available as mentioned in subsection (1).
(3) This section does not apply to section 124A or 138 (automatic car or van for a disabled employee).
117 Meaning of car or van made available by reason of employment
(1) For the purposes of this Chapter a car or van made available by an employer to an employee or member of an employee's family or household is to be regarded as made available by reason of the employment unless subsection (2) , (3) or (4) excludes the application of this subsection.
(2) Subsection (1) does not apply where—
(a) the employer is an individual, and
(b) the car or van in question is made available in the normal course of the employer's domestic, family or personal relationships.
(3) Subsection (1) does not apply where—
(a) the employer carries on a vehicle hire business under which cars or vans of the same kind are made available to members of the public for hire,
(b) the car or van in question is hired to the employee or member in the normal course of that business, and
(c) in hiring that car or van the employee or member is acting as an ordinary member of the public.
(4) Subsection (1) does not apply where—
(a) the employer carries on a business under which cars or vans of the same kind are made available to members of the public for sale or lease,
(b) the car or van in question is sold or leased to the employee or member in the normal course of that business, and
(c) the terms on which the car or van is sold or leased to the employee or member might reasonably be expected to be agreed between the employer and a member of the public with whom the employer deals at arm’s length.
(1) For the purposes of this Chapter a car or van made available in a tax year to an employee or a member of the employee’s family or household is to be treated as available for the employee’s or member’s private use unless in that year—
(a) the terms on which it is made available prohibit such use, and
(b) it is not so used.
(2) In this Chapter “private use”, in relation to a car or van made available to an employee or a member of the employee’s family or household, means any use other than for the employee’s business travel (see section 171(1)).
119 Where alternative to benefit of low emission car or van offered
(1) This section applies where in a tax year—
(a) a car is made available as mentioned in section 114(1),
(b) the car's CO2 emissions figure (see sections 133 to 138) does not exceed 75 grams per kilometre, and
(c) an alternative to the benefit of the car is offered.
(2) The mere fact that the alternative is offered does not result in an amount in respect of the benefit constituting earnings by virtue of Chapter 1 of this Part (earnings).
(1) If this Chapter applies to a car in relation to a particular tax year, the cash equivalent of the benefit of the car is to be treated as earnings from the employment for that year.
(2) In such a case (including a case where the cash equivalent of the benefit of the car is nil) the employee is referred to in this Chapter as being chargeable to tax in respect of the car in that year.
(3) Any reference in this Act to a case where the cash equivalent of the benefit of a car is treated as the employee's earnings for a year by virtue of this section includes a case where the cash equivalent is nil.
(4) This section is subject to section 120A.
120A Benefit of car treated as earnings: optional remuneration arrangements
(1) Where this Chapter applies to a car in relation to a particular tax year and the conditions in subsection (3) are met—
(a) the relevant amount (see section 121A) is to be treated as earnings from the employment for that tax year, and
(b) section 120(1) does not apply.
(2) In such a case (including a case where the relevant amount is nil) the employee is referred to in this Chapter as being chargeable to tax in respect of the car in the tax year.
(3) The conditions are that—
(a) the car is made available to the employee or member of the employee's household pursuant to optional remuneration arrangements,
(b) the total foregone amount in connection with the car for the tax year is is greater than the modified cash equivalent of the benefit of the car for the tax year (see section 121B), and
(c) the car's CO2 emissions figure (see sections 133 to 138) exceeds 75 grams per kilometre.
(4) In this section, and in section 121A, the total foregone amount in connection with the car for a tax year is the total of—
(a) the amount foregone (see section 69B) with respect to the benefit of the car for that year, and
(b) the amount foregone (see section 69B) with respect to each other benefit that—
(i) is connected with the car,
(ii) is provided in that year for the employee, or a member of the employee's household, pursuant to optional remuneration arrangements, and
(iii) is neither the provision of a driver nor the provision of fuel.
121 Method of calculating the cash equivalent of the benefit of a car
(1) The cash equivalent of the benefit of a car for a tax year is calculated as follows—
Step 1
Find the price of the car in accordance with sections 122 to 124A.
Step 2
Add the price of any accessories which fall to be taken into account in accordance with sections 125 to 131.
Step 3
Make any deduction under section 132 for capital contributions made by the employee to the cost of the car or accessories. The resulting amount is the interim sum.
Step 4
...
Step 5
Find the appropriate percentage for the car for the year in accordance with sections 133 to 142.
Step 6
Multiply the interim sum by the appropriate percentage for the car for the year.
Step 7
Make any deduction under section 143 for any periods when the car was unavailable.
The resulting amount is the provisional sum.
Step 8
Make any deduction from the provisional sum under section 144 in respect of payments by the employee for the private use of the car.
The result is the cash equivalent of the benefit of the car for the year.
(2) The method of calculation set out in subsection (1) is modified in the special cases dealt with in—
section 146 (cars that run on road fuel gas), and
section 147 (classic cars: 15 years of age or more).
(3) Where the car is shared the cash equivalent is calculated under this section in accordance with section 148.
121A Optional remuneration arrangements: method of calculating relevant amount
(1) To find the relevant amount for the purposes of section 120A, take the following steps—
Step 1 Take the total foregone amount in connection with the car for the tax year (see section 120A(4)). .
Step 2 Make any deduction under section 132A in respect of capital contributions made by the employee to the cost of the car or accessories.
The resulting amount is the provisional sum.
Step 3 Make any deduction from the provisional sum under section 144 in respect of payments by the employee for the private use of the car.
The result is the “relevant amount” for the purposes of section 120A.
(2) Where it is necessary, for the purpose of determining the “total foregone amount” for the purposes of step 1 of subsection (1), to apportion an amount of earnings to a benefit mentioned in section 120A(4)(a) or (b) for the tax year, the apportionment is to be made on a just and reasonable basis.
In this subsection “earnings” is to be interpreted in accordance with section 69B(5).
(1) The “modified cash equivalent” of the benefit of a car for a tax year is calculated in accordance with the following steps (which must be read with subsections (2) to (4))—
Step 1 Find the price of the car in accordance with sections 122 to 124A.
Step 2 Add the price of any accessories which fall to be taken into account in accordance with sections 125 to 131.
The resulting amount is the interim sum.
Step 3 Find the appropriate percentage for the car for the year in accordance with sections 133 to 142.
Step 4 Multiply the interim sum by the appropriate percentage for the car for the year.
Step 5 Make any deduction under section 143 for any periods when the car was unavailable.
The resulting amount is the modified cash equivalent of the benefit of the car for the year.
(2) Where the car is shared the modified cash equivalent is calculated under this section in accordance with section 148.
(3) The modified cash equivalent of the benefit of a car for a tax year is to be taken to be zero if the condition in subsection (4) is met.
(4) The condition is that the benefit of the car for the tax year would be exempt from income tax but for section 228A (exclusion of certain exemptions).
(5) The method of calculation set out in subsection (1) is modified in the special cases dealt with in—
(a) section 146 (cars that run on road fuel gas), and
(b) section 147A (classic cars: optional remuneration arrangements).
(1) For the purposes of this Chapter the price of a car means—
This is subject to section 124A (automatic car for a disabled employee).
(a) its list price, if it has one, or
(b) its notional price, if it has no list price.
(2) This is subject to section 124A (automatic car for a disabled employee).