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HMRC internal manual

National Insurance Manual

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HM Revenue & Customs
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Class 1: Vouchers - non-cash vouchers - calculation of the amount of earnings - the chargeable expense - voucher provided for two or more employees

Regulation 24 and paragraph 15 of Schedule 2 Social Security (Contributions)Regulations 2001

NIM02466 explains how to calculate the amount of earnings included in any paymentmade by way of a non-cash voucher (see

NIM02413). But where anon-cash voucher is provided to two or more employees, the amount of earnings is to becalculated or estimated as follows:

Proportion of the benefit of the voucher for each employee is known at the time ofpayment

The amount of earnings for each employee is:

  • an amount equal to the proportion of the benefit of the voucher;
  • less any amount made good by the employee.

Proportion of the benefit of the voucher for each employee is not known at time ofpayment

The amount of earnings for each employee is:

  • an amount equal to the chargeable expense divided equally between the number of employees concerned;
  • less any amount made good by the employee.

For examples illustrating the above calculations, see NIM02470.

For income tax purposes, the method of apportioning the chargeable expense is not the sameas the above. For details, see EIM16160.