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HMRC internal manual

Employment Income Manual

Particular benefits: third party entertainment: general

Sections 265, 266(1) and 267(1) ITEPA 2003

An employee or office holder is exempt from tax on employment income on certain goodwill entertainment, provided by third parties, for him or her or for a member of their family or household. Details are at EIM21837.

The exemption applies to all employees whether or not for 2015/16 and earlier, they are directors or employees in an excluded employment (see EIM20007).

The exemption covers liability that could otherwise arise under the following provisions:

  • Part 3 Chapter 4 ITEPA 2003 (non-cash vouchers, see EIM16000 onwards)
  • Part 3 Chapter 4 ITEPA 2003 (credit-tokens, see EIM16090 onwards)
  • Part 3 Chapter 6 ITEPA 2003 (benefits of directors and employees, except those in an excluded employment).

For the meaning of “family or household” see EIM20504.

(This content has been withheld because of exemptions in the Freedom of Information Act 2000)


  • EIM21836 for the meaning of “entertainment”.
  • EIM21838 for what to do about multi-purpose vouchers and credit tokens
  • EIM21839 for what to do when calculating whether an employee’s earnings are less than £8,500 a year
  • EIM21840 for the interaction with the disallowance of entertaining expenditure under Section 356 ITEPA 2003 when calculating the employer’s taxable business profits.