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HMRC internal manual

Employment Income Manual

Employment income: scholarship income: scholarship and apprenticeship schemes at universities and colleges

Statement of Practice 4/1986


Statement of Practice (SP) 4/86 was first published in 1986. It explained the, then, Inland Revenue’s view of the application of Section 776 IT(TOI)A 2005 to students who are either sponsored by their employers to undertake full time higher educational course or are on sandwich courses under the terms of which they are required to work for the employer during vacations and at other times.

The Practice is an administrative easement. If students or trainees satisfy the conditions HMRC accepts without further question that the income paid by their employer to maintain them while studying is scholarship income within the meaning of Section 776. This procedure relieves all parties from having to undertake detailed scrutiny of the legal relationships.

The current version of SP 4/86 was published on 15 August 2007 taking effect for the academic year 1 September 2007 to August 2008 and subsequent years. For the full text see EIM06237).

For limits applying in relation to earlier periods, see the table at EIM06240.