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HMRC internal manual

Employment Income Manual

Vouchers and credit-tokens: raffles and lotteries

For a description of the points to consider in a case involving a voucher or credit-token see EIM16030.

In order to reward employees for good timekeeping, safety records or sales performance, etc an employer or third party may operate an incentive scheme under which employees with the best performance are given an opportunity to enter a draw for a substantial prize, rather than prizes of a lower value being distributed amongst all eligible employees. In such circumstances, the winning draw tickets are likely to be non-cash vouchers giving rise to a benefit (see EIM16140). It is sometimes argued that the raffle or lottery results in prizes being awarded by chance and not by reason of the employment. This contention should not be accepted unless it can be shown that the draw was equally open to members of the general public, on the same terms as employees.

For incentive schemes generally see EIM11200.