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(c) is a child in respect of whom the employee has all the rights, duties, | |
powers, responsibilities and authority which by law a parent of a child | |
has in relation to the child and the child’s property. | |
In paragraph (a) “child” includes stepchild. | |
(4) Condition B is that— | 5 |
(a) the premises on which the care is provided are not used wholly or | |
mainly as a private dwelling, and | |
(b) any applicable registration requirement is met with respect to the | |
premises. | |
(5) In subsection (4), “registration requirement” means a requirement that a | 10 |
person providing the care is registered under— | |
(a) section 71 or Part 10A of the Children Act 1989 (c. 41), or | |
(b) Article 118 of the Children (Northern Ireland) Order 1995 (S.I.1995/755 | |
(N.I. 2)), | |
with respect to premises. | 15 |
(6) Condition C is that— | |
(a) the premises on which the care is provided are made available by the | |
employer alone, or | |
(b) the care requirements are met. | |
(7) The care requirements are that— | 20 |
(a) the care is provided under arrangements made by persons who include | |
the employer, | |
(b) the premises on which it is provided are made available by one or more | |
of those persons, and | |
(c) under the arrangements the employer is wholly or partly responsible | 25 |
for financing and managing the provision of the care. | |
(8) In this section “care” means— | |
(a) any form of care, and | |
(b) any form of supervised activity which is not provided primarily for | |
education purposes. | 30 |
Telephones and computer equipment | |
319 Mobile telephones | |
(1) No liability to income tax arises by virtue of Chapter 10 of Part 3 (taxable | |
benefits: residual liability to charge) in respect of the provision for an employee | |
or a member of the employee’s family or household of a mobile telephone | 35 |
without any transfer of property in it. | |
(2) In this section “mobile telephone” means telephone apparatus which— | |
(a) is not physically connected to a land-line, and | |
(b) is not a cordless telephone or a telepoint telephone. | |
(3) For the purposes of subsection (2)— | 40 |
“cordless telephone” means telephone apparatus designed or adapted to | |
provide a wireless extension to a telephone and used only as such an | |
extension to a telephone which is physically connected to a land-line, | |
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“telephone apparatus” means wireless telegraphy apparatus designed or | |
adapted for the purpose of transmitting and receiving spoken messages | |
and connected to a public telecommunication system (as defined in | |
section 9(1) of the Telecommunications Act 1984 (c. 12)), and | |
“telepoint telephone” means telephone apparatus used for the purpose of | 5 |
a short-range radio communications service at frequencies between 864 | |
and 868 megahertz (inclusive). | |
320 Limited exemption for computer equipment | |
(1) No liability to income tax arises by virtue of Chapter 10 of Part 3 (taxable | |
benefits: residual liability to charge) in respect of the provision of computer | 10 |
equipment if conditions A to C are met. | |
(2) Condition A is that the equipment is made available to the employee or to a | |
member of the employee’s family or household without any transfer of | |
property in it. | |
(3) Condition B is that the arrangements under which computer equipment is | 15 |
made available to employees of the employer, or to members of their families | |
or households, do not favour directors (see subsection (6)). | |
(4) Condition C is that the aggregate cash equivalent of the benefit of the provision | |
of such equipment in the tax year does not exceed £500. | |
(5) If conditions A and B are met, but condition C is not, the employee is only liable | 20 |
to income tax in the tax year by virtue of Chapter 10 of Part 3 on so much of that | |
aggregate cash equivalent as exceeds £500. | |
(6) The arrangements referred to in condition B are only taken to favour directors | |
if— | |
(a) the only such arrangements are arrangements under which the | 25 |
employee is required to be a director of a company, or | |
(b) taking all such arrangements together, the terms on which the | |
equipment is made available are more favourable in some or all cases | |
where the employee is a director than in one or more cases where the | |
employee is not. | 30 |
(7) In this section— | |
(a) “computer equipment” includes printers, scanners, modems, discs and | |
other peripheral devices designed to be used by being connected to or | |
inserted in a computer, | |
(b) “director” has the meaning given by section 67(1), | 35 |
(c) references to making computer equipment available— | |
(i) include references to the provision, together with any computer | |
equipment made available, of a right to use computer software, | |
but | |
(ii) do not include references to the provision of access to, or the use | 40 |
of, any public telecommunication system, and | |
(d) “public telecommunication system” has the same meaning as in the | |
Telecommunications Act 1984 (c. 12) (see section 9(1)). | |
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Awards and gifts | |
321 Suggestion awards | |
(1) This section applies where an employer establishes a scheme for the making of | |
suggestions that is open on the same terms— | |
(a) to employees of the employer generally, or | 5 |
(b) to a particular description of them. | |
(2) No liability to income tax arises in respect of an encouragement award or | |
financial benefit award made under the scheme for a suggestion which meets | |
conditions A to C if, or to the extent that, it does not exceed the permitted | |
maximum for the award under section 322. | 10 |
(3) Condition A is that the suggestion relates to the activities carried on by the | |
employer. | |
(4) Condition B is that the suggestion is made by an employee who could not | |
reasonably be expected to make it in the course of the duties of the | |
employment, having regard to the employee’s experience. | 15 |
(5) Condition C is that the suggestion is not made at a meeting held for the | |
purpose of proposing suggestions. | |
(6) In this section and section 322— | |
“encouragement award” means an award, other than a financial benefit | |
award, made for a suggestion with intrinsic merit or showing special | 20 |
effort, and | |
“financial benefit award” means an award for a suggestion relating to an | |
improvement in efficiency or effectiveness which the employer has | |
decided to adopt and reasonably expects will result in a financial | |
benefit. | 25 |
322 Suggestion awards: “the permitted maximum” | |
(1) The permitted maximum for an encouragement award for the purposes of | |
section 321 (suggestion awards) is £25. | |
(2) The permitted maximum for a financial benefit award where no such award | |
for the suggestion has been made before is— | 30 |
(a) if only one such award is made for the suggestion, the suggestion | |
maximum, and | |
(b) if two or more such awards are made on the same occasion to different | |
persons for the suggestion, the appropriate proportion of the | |
suggestion maximum. | 35 |
(3) If on a later occasion or occasions one or more further such awards are made | |
for the same suggestion, the permitted maximum for each is— | |
(a) if only one such award is made for the suggestion on that occasion, the | |
residue of the suggestion maximum, and | |
(b) if two or more such awards are made on the same occasion to different | 40 |
persons for the suggestion, the appropriate proportion of that residue. | |
(4) The suggestion maximum for a financial benefit award is the financial benefit | |
share or £5000 if that is less. | |
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(5) In subsection (4) “the financial benefit share” means the greater of— | |
(a) half the financial benefit reasonably expected to result from the | |
adoption of the suggestion for the first year after its adoption, and | |
(b) one-tenth of the financial benefit reasonably expected to result from its | |
adoption for the first 5 years after its adoption. | 5 |
(6) In this section— | |
“the appropriate proportion” means such proportion as the award bears | |
to the total of the financial benefit awards made on the same occasion | |
for the suggestion, | |
“the residue of the suggestion maximum” means the suggestion | 10 |
maximum less the total previous exemption, and | |
“the total previous exemption” means the total of the amounts exempted | |
from income tax under section 321 in respect of financial benefit awards | |
for the suggestion made on previous occasions. | |
323 Long service awards | 15 |
(1) No liability to income tax arises in respect of a long service award which meets | |
the condition in subsection (3) if or to the extent that the chargeable amount | |
does not exceed the permitted maximum. | |
(2) In subsection (1)— | |
“chargeable amount” means the amount of employment income which | 20 |
would be charged to tax in respect of the award apart from subsection | |
(1), | |
“long service award” means an award made to an employee to mark not | |
less than 20 years’ service with the same employer, and | |
“permitted maximum” means £20 for each year of service in respect of | 25 |
which the award is made. | |
(3) The condition is that the award must take the form of— | |
(a) tangible moveable property, | |
(b) shares in a company which is, or belongs to the same group as, the | |
employer, or | 30 |
(c) the provision of any other benefit except— | |
(i) a payment, | |
(ii) a cash voucher, | |
(iii) a credit-token, | |
(iv) securities, | 35 |
(v) shares not within paragraph (b), or | |
(vi) an interest in or rights over securities or shares. | |
(4) Subsection (1) does not apply to an award (“the later award”) if another award | |
to mark a particular period of service with the same employer has been made | |
to the employee in the period of 10 years ending with the date on which the | 40 |
later award is made. | |
(5) For the purposes of this section, service is treated as being with the same | |
employer if it is with two or more employers— | |
(a) each of whom is a successor or predecessor of the others, or | |
(b) one of whom is a company which belongs or has belonged to the same | 45 |
group as the others or a predecessor or successor of the others. | |
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(6) In this section “group” means a body corporate and its 51% subsidiaries. | |
324 Small gifts from third parties | |
(1) No liability to income tax arises in respect of a gift provided for an employee | |
or a member of the employee’s family or household if conditions A to E are | |
met. | 5 |
(2) Condition A is that the gift is not provided by the employer or a person | |
connected with the employer. | |
(3) Condition B is that neither the employer nor a person connected with the | |
employer has directly or indirectly procured the gift. | |
(4) Condition C is that the gift is not made in recognition of particular services | 10 |
performed by the employee in the course of the employment or in anticipation | |
of such services. | |
(5) Condition D is that the gift is not cash or securities or the use of a service. | |
(6) Condition E is that the total cost to the donor of all the eligible gifts in respect | |
of the employee in question during the tax year does not exceed £150. | 15 |
(7) For the purposes of condition E, the total cost to the donor includes any value | |
added tax payable on the supply of the gifts to the donor, whether or not the | |
donor is entitled to a credit or repayment in respect of that tax. | |
(8) In this section “eligible gifts” means all gifts which— | |
(a) meet conditions A to D, or | 20 |
(b) are non-cash vouchers or credit-tokens and meet— | |
(i) conditions A to C, and | |
(ii) conditions A and B in section 270 (exemption for small gifts of | |
vouchers and tokens from third parties). | |
(9) Subsection (1) does not apply to non-cash vouchers and credit-tokens (but see | 25 |
section 270 which makes provision for a corresponding exemption for them). | |
Overseas medical treatment | |
325 Overseas medical treatment | |
(1) No liability to income tax arises by virtue of Chapter 10 of Part 3 (taxable | |
benefits: residual liability to charge) in respect of— | 30 |
(a) providing an employee with medical treatment outside the United | |
Kingdom where the need for it arises while the employee is outside the | |
United Kingdom for the purpose of performing the duties of the | |
employment, or | |
(b) providing an employee with insurance against the cost of providing | 35 |
such treatment. | |
(2) For the purposes of this section— | |
(a) “medical treatment” includes all procedures for diagnosing or treating | |
any physical or mental illness, infirmity or defect, and | |
(b) providing a person with medical treatment includes providing for the | 40 |
person to be an in-patient so that such treatment can be given. | |
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