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HMRC internal manual

Tax Credits Technical Manual

Income: Employment income rules: The cash equivalent of any cash voucher received by the claimant chargeable to income tax under section 81 of ITEPA 2003

The Tax Credits (Definition and Calculation of Income) Regulations 2002, Reg. 4(1)(e)

The general rule is that income must include an amount equal to the sum of money for which the voucher is capable of being exchanged.

The full rules can be found via the fifth row in the table in Employment Income Manual para EIM16140.


Note: With effect from 6 April 2017 the way in which many salary sacrifice and benefit in kind schemes are taxed will change, which means that some tax credit claimants will see an increase in their taxable income.

For the purposes of tax credits, where one of these schemes is in operation the taxable income figure should be used.