Part B of form P9D, the form used to report benefits provided for employees with an earnings rate of less than £;8,500, has an entry line with the description "Credit cards provided for the employee and his or her family/household". This description was introduced with the P9D issued for the 1999/2000 tax year, prior to which the description read "Credit cards provided for the employee and his or her family".

Most benefits-in-kind are also taxable if they are made available to an employee's "family or household". Members of an employee's family are the employee's spouse, children and their spouses, parents and dependants. Members of an employee's household are the employee's family members (as already defined), plus the employee's domestic staff and guests.

According to Chapter 3 of the Benefits Code, the "use of a credit-token by a member of an employee's family is to be treated as use of the token by the employee". There is no reference to members of the employee's household.

We recently asked HMRC to comment on the discrepancy between the legislation and the description on form P9D. The reply stated that "it appears that the inclusion of the word 'household' here is an oversight which we will correct at the earliest opportunity", presumably on the version of form P9D for 2005/06.

...back to 26 May 2005

Source:
Income Tax (Earnings and Pensions) Act 2003 (s91)
EIM16080 - Vouchers and credit-tokens: meaning of relation

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