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HMRC internal manual

Employment Income Manual

Optional remuneration arrangements: Particular issues - Pre-employment negotiations

Section 69A ITEPA 2003

Before starting a job, an individual will often be presented with the offer of a remuneration package with the option of a right to some form of monetary earnings or one or more benefits in kind. If the individual chooses the benefit then the benefit will be provided under optional remuneration arrangements. The individual is giving up a future right to receive an amount of earnings with Chapter 1 of Part 3


An individual accepts a job offer from a new employer. Under the terms and conditions of the new employment setting out his remuneration package from the employment, the individual is offered the option of a cash allowance of £5,000 or a company car. The individual decides to opt for the company car. The benefit is under optional remuneration arrangements since the individual has agreed to be provided with the car benefit rather than an amount of earnings within Chapter 1 of Part 3.