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HMRC internal manual

Employment Income Manual

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Employment income provided through third parties: glossary

A, B and P In this guidance (as in Part 7A ITEPA 2003):A is the employee (or former or prospective employee) mentioned in Section 554A(1)(a),B is A’s employer (or former or prospective employer), and(unless otherwise specified) P is the person taking the step under review.
   
‘Arrangement’ and ‘taxavoidance arrangement’ ‘Arrangement’ and ‘tax avoidance arrangement’ are statutory terms: see EIM45855.
Earmarking ‘Earmarked’ is the key term in Section 554B(1)(a), one of the provisions which define ‘relevant step’.See EIM45095 onwards.
EBT Employee benefit trust. This is just one example of a trust and any other sort of trust could be involved in arrangements that are covered by Part 7A.
EFRBS Employer-financed retirement benefits scheme. See Part 6 Chapter 2 ITEPA 2003 and EIM15010 onwards.
Exit event For the meaning of ‘exit event’ in Sections 554K and 554M, see EIM45465.
‘Linked’ with A ‘Linked’ with A is a statutory term: see EIM45860.
Part 7A income This guidance refers to employment income under Part 7A ITEPA 2003 as ‘Part 7A income’ for short.
The Part 7A rules This guidance refers to the legislation on employment income provided through third parties, introduced by Schedule 2 FA 2011 and chiefly contained in Part 7A ITEPA 2003, as ‘the Part 7A rules’ for short. You may find that some people refer to the Part 7A rules as the ‘disguised remuneration’ regime.
Relevant income For the meaning of ‘relevant income’ in Sections554J to 554M, see EIM45475.
Relevant person A relevant step within Section 554C or 554D is taken in favour of a ‘relevant person’.See EIM45090.
Relevant shares For the meaning of ‘relevant shares’ in Sections 554J to 554M and 554Z7, see EIM45480.
Relevant step A relevant step is an action which gives rise to Part7A income by reason of A’s employment with B.The amount of the Part 7A income is the value of the relevant step (adjusted as appropriate).See EIM45055 onwards.
Relevant third person A relevant step only gives rise to Part 7A income if it is taken by a ‘relevant third person’.See EIM45035.
Section 554A gateway The conditions in Section 554A(1) must be met before an arrangement can give rise to Part 7A income.This guidance refers to meeting these conditions as ‘coming through the Section 554A gateway’. SeeEIM45025.
Section 554* Part 7A ITEPA 2003 comprises Sections 554A to 554Z21.In this guidance, any reference to a section number (without specifying the Act it relates to) is to that section of ITEPA 2003.For example, ‘Section 554P’ is a reference to Section554P ITEPA2003.