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HMRC internal manual

Employment Income Manual

Employee Ownership Trusts – qualifying bonus payments: Excluded payments

Section 312H ITEPA 2003


This section prevents salary sacrifice arrangements applying to qualifying bonus payments.  This applies to any such arrangements to which an employee or former employee is party and which are made either before or after the employee commences employment.   The arrangements can include:-

  • the employee giving up the right to receive an amount of general earnings or specific employment income in return for a qualifying bonus payment
  • the employer and employee agreeing that the employee will receive the qualifying bonus payment rather than some other form of employment income.