Employment income: exemption for suggestion scheme awards: two or more awards for same suggestion on same occasion: example
Section 322(2) ITEPA 2003
Two employees, A and B, make a joint suggestion under a staff suggestion scheme which satisfies the conditions in Section 321 ITEPA 2003 (see EIM06610).Their employer decides to award £2,000 to A and £1,000 to B. The employer calculates the suggestion maximum for the suggestion as £4,500 (see EIM06630).
For employee A, the permitted maximum is:
|(£2,000 / (£2,000 + £1,000)) x £4,500||= £3,000|
This is more than £2,000, so A’s award is entirely exempt.
For employee B, the permitted maximum is:
|(£1,000 / (£2,000 + £1,000)) x £4,500||= £1,500|
This is more than £1,000, so B’s award is entirely exempt.
As only £3,000 of the suggestion maximum has been used, the balance of £1,500 is available if the employer decides to make a later award in respect of the same suggestion (see EIM06650).
See also example EIM06642.