Income Tax (Earnings and Pensions) Act 2003 section 243

Support for public bus services

Section 243 provides an income tax exemption where an employer gives financial or other support for a public bus or road transport service used by employees for work-related journeys.

• No income tax liability arises when an employer supports a public transport road service that employees use for qualifying journeys, provided certain conditions are met.
• For local bus services, the service must be used by employees for qualifying journeys (such as commuting or travel between workplaces) and must be available generally to all employees of the employer concerned.
• For other public transport road services that are not local bus services, an additional condition applies: the terms offered to employees must be no more favourable than those available to other passengers.
• A "local bus service" is defined by reference to the Transport Act 1985, and a "public transport road service" means any public passenger transport service provided by a road vehicle.