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HMRC internal manual

Employment Income Manual

The benefits code: types of income included

Part 3 Chapters 2 to 11 ITEPA 2003 and Section 63(1) ITEPA 2003

Income within the benefits code is treated as earnings taxable as employment income (EIM00510).

Section 63(1) ITEPA 2003 lists the types of income included in the benefits code in Part 3 Chapters 3 to 10 ITEPA 2003:

Chapter 3 Expense payments (EIM20600)
Chapter 4 Vouchers and credit cards (EIM16000)
Chapter 5 Provision of living accommodation (EIM11300)
Chapter 6 Cars, vans and related benefits (EIM22050)
Chapter 7 Loans (EIM26100)
Chapter 8 Notional Loans in respect of shares (Share Schemes Manual (SSM))
Chapter 9 Disposal of shares for more than market value (SSM)
Chapter 10 Residual liability to charge for benefits generally (EIM20010)

Chapter 3 relates to expense payments (EIM20600).

There are different rules for the specific benefits falling within each of Chapters 4 to 9. Please consult the relevant guidance for information on those rules.

Chapter 10 covers the general rules for those benefits that do not fall into any of Chapters 4 to 9. For the purpose of Chapter 10, benefits in Chapters 4 to 9 are “excluded benefits” (Section 202(1) ITEPA 2003).

The guidance that follows concerns expense payments to, and general benefits provided for, directors and employees under Chapters 3 and 10. Note that for 2015/16 and earlier, some Chapters of the benefits code do not apply if the employment is an “excluded employment” (EIM20007).