Income Tax (Earnings and Pensions) Act 2003 section 88

Year in which earnings treated as received

Section 88 establishes the timing rules for determining the tax year in which the value of non-cash vouchers provided to employees is treated as received for income tax purposes.

• For non-cash vouchers (other than cheque vouchers), the earnings are treated as received in the tax year the cost of provision is incurred, or the tax year the employee receives the voucher, whichever is later.
• For cheque vouchers, the earnings are treated as received in the tax year the voucher is actually handed over in exchange for money, goods or services.
• If a cheque voucher is posted rather than physically handed over, it is treated as handed over at the time of posting.
• These timing rules determine the tax year in which the voucher benefit falls to be assessed, which matters where a voucher is issued in one tax year but the relevant event occurs in another.