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HMRC internal manual

National Insurance Manual

Class 1: Vouchers - non-cash vouchers - calculation of the amount of earnings - the chargeable expense

Sections 3(1) and 6(1) Social Security Contributions and Benefits Act 1992

Paragraph 14 of Schedule 2 Social Security (Contributions) Regulations 2001

The amount of a non-cash voucher (see NIM02413) to be included in an employee’s earnings is:

  • the amount equal to the expense incurred by the person at whose cost the voucher is obtained (“the chargeable expense”); less
  • any part of the expense made good to that person by the employee

Liability for Class 1 NICs arises at the time the non-cash voucher is provided to the employee.


  • examples illustrating the general rule for calculating the chargeable expense, see NIM02462
  • details of how to calculate:

    • the chargeable expense where a non-cash voucher is provided to 2 or more employees, see NIM02464
    • from 6 April 2005, the exempt amount for a qualifying childcare voucher (see NIM02488), see NIM02470 (contents)

Where a non-cash voucher is provided through an optional remuneration arrangement (OpRA), EIM44000, the relevant amount to treat as earnings from the employment is the greater of:

  • the cost of providing the voucher
  • the amount the employee has foregone in relation to the benefit of the voucher