Beta This part of GOV.UK is being rebuilt – find out what this means

HMRC internal manual

Employment Income Manual

From
HM Revenue & Customs
Updated
, see all updates

Employment income: basis of assessment for general earnings: table setting out the basis of assessment to be used for particular types of payment, and benefits in kind

The receipts basis of assessment applies to all general earnings (including benefits in kind) from an office or employment (see EIM42201).

There are rules that tell you when different types of earnings are treated as received. They are summarised in the following table.

Table 1 covers all directors and employees whatever their rate of pay.

Table 2 provides additional rules that do not apply for 2015/16 and earlier to employees in excluded employments (see EIM20100).

Table 1: all directors and employees whatever their rate of pay

Type of earnings Years assessable Statutory authority
     
Employee resident and domiciled in UK: money earnings The year the earnings are received (see EIM42260 for the meaning of received) Section 15(2) ITEPA 2003
Employee resident but not domiciled in UK and does not meet the conditions of section 26A: money earnings except chargeable overseas earnings The year the earnings are received (see EIM42260 for the meaning of received) Section 15(2) ITEPA 2003
Employee resident but not domiciled in UK and meets the conditions of section 26A: money earnings for UK duties The year the earnings are received (see EIM42260 for the meaning of received) Section 15(2) ITEPA 2003
Employee not resident in UK: money earnings for UK duties The year the earnings are received (see EIM42260 for the meaning of received) Section 27(2) ITEPA 2003
Employee resident but not domiciled in UK and does not meet the conditions of section 26A: chargeable overseas earnings The year the earnings are received in the United Kingdom (see EIM42370 for the meaning of received in the United Kingdom) Section 22(2) ITEPA 2003
Employee resident but not domiciled in the UK and meets the conditions of section 26A: foreign earnings The year the earnings are received in the United Kingdom (see EIM42370 for the meaning of received in the United Kingdom) Section 26(2) ITEPA 2003
Money’s worth (see EIM00530) The year the benefit is provided Section 19(4) ITEPA 2003
Pecuniary liability payments (see EIM00580) The year the payment is made Section 19(4) ITEPA 2003
Non-cash vouchers (see EIM16010 onwards) Cheque voucher - the year the employee uses it to get goods or services or, if earlier, the year it is appropriated to the employee. Other voucher - the later of the year the employer incurs the expense or the year the voucher is received (see EIM16030). Section 19(3) ITEPA 2003
Credit tokens (see EIM16090 onwards The year the token is used Section 19(2) ITEPA 2003
PAYE cash vouchers (see EIM16110) The year the employee receives the voucher or, if earlier, the year it is appropriated to the employee Section 19(2) ITEPA 2003
Living accommodation (see EIM11300 onwards) The year during which accommodation is provided Section 19(2) ITEPA 2003
Payments on cessation, or a change in duties or earnings etc (see EIM13000 onwards)    
[Note: these payments are taxed as “specific employment income”, not general earnings. They are included here for completeness.] The year in which the payment or benefit is received.
As regards the meaning of receipt in relation to payments and benefits chargeable under Section 403, see EIM13110. Section 403(2) ITEPA 2003
       
  Sick pay (see EIM06400 onwards) The year the sick pay is received See above entries for money earnings
  Restrictive covenants (see EIM03600 onwards) The year the payment is made Section 225(1) ITEPA 2003
  Pensions and annuities (see EIM74101 onwards) The receipts basis does not apply to pensions and annuities. The amount chargeable is the amount arising, or payable, in the year Sections 571, 578, 581, 616 and 634(2) ITEPA 2003
  Social Security benefits (see EIM76000 onwards) The receipts basis does not apply to Social Security benefits. The amount chargeable is the amount arising, or payable, in the year Section 661(2) ITEPA 2003

Table 2: additional rules that do not apply for 2015/16 and earlier to employees in excluded employments

Type of earnings Years assessable Statutory authority
     
Expenses payments (see EIM20601) The year the payment is received (see EIM42260) See entries for money earnings in Table 1 above
Benefits other than those mentioned below (see EIM21001) The year the benefit is provided Section 19(2) ITEPA 2003
Car benefits (see EIM23000) Years in which the car is available Section 19(2) ITEPA 2003
Car fuel (see EIM25500) Years in which the fuel is provided Section 19(2) ITEPA 2003
Beneficial loans (see EIM26102) Years in which the loan is outstanding Section 19(2) ITEPA 2003
Loan written off etc (see EIM21740) The year the loan is written off or released (see EIM21741) Section 19(2) ITEPA 2003
Disposal of shares (see SSM6.52) The year of the disposal Section 19(2) ITEPA 2003
Director’s PAYE paid by employer (see EIM21790) The year in which the tax is paid to the Board, except that if the tax is paid after the directorship has ended the charge is in the year the directorship ended (see EIM21795) Section 19(2) ITEPA 2003