Taxation of Chargeable Gains Act 1992 section 236K

Further provision about the equality requirement

Section 236K elaborates on the equality requirement introduced by section 236J, clarifying the circumstances in which differing treatment of eligible employees does not breach that requirement, and the limited grounds on which benefit amounts may vary between employees.

• The equality requirement is not breached by provisions allowing benefits to pass to a deceased employee's surviving spouse, civil partner or dependant for up to 12 months, by excluding employees with less than 12 months' continuous service, by honouring an employee's written opt-out request, or by excluding persons who qualify solely as office-holders.
• Trusts may also permit settled property to be applied for charitable purposes alongside employee benefits without breaching the equality requirement.
• Benefits may vary between eligible employees by reference to remuneration, length of service or hours worked, but each factor must generate a separate entitlement and the total benefit must be the sum of those separate entitlements.
• Despite the permitted variations, the equality requirement is breached if the trust terms result in some eligible employees receiving no benefit at all (other than through the specific exclusions for short service, written opt-outs or office-holder status).