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HMRC internal manual

Employment Income Manual

HM Revenue & Customs
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Particular benefits: operational risk injuries and occupational diseases

If an employer meets the cost of medical treatment provided for an employee, a charge to tax will normally arise under Part 3 Chapter 10 ITEPA 2003 (see EIM21760).

But where the employee’s injury or illness:

  • can be shown to be a risk of the employee’s occupation and
  • is due to a cause which is reasonably attributable to the nature of the employee’s office or employment and
  • is not a risk common to everybody

there may be no chargeable benefit if the treatment is intended to return the employee to the state of health enjoyed before the injury or illness.

For example, if a professional footballer breaks his leg whilst playing football, and the football club that employs him pays for special treatment to speed his recovery, the costs incurred by the employer do not give rise to a chargeable benefit because the employee has not been provided with any benefit. The treatment merely returns him to the level of health and fitness he enjoyed before breaking his leg whilst performing the duties of his employment playing football. On the other hand, if the footballer breaks his leg at home, and the football club pays for his treatment, this will give rise to a chargeable benefit.

Likewise, if an employer takes out a medical insurance policy purely to cover an employee against work-related injury (and/or illness), and the policy does not provide cover for any family or household members of the employee, the premium paid by the employer is intended to provide insurance against its own liabilities as an employer. In these circumstances, there will be no charge as a benefit to the employee. If the insurance covers injury incurred both at work and outside work, a benefit will result.

The Health & Safety Executive (HSE) publishes guidance on tax rules and occupational health support. See the pdf on the hse internet site