NIM02438 - Class 1: vouchers - non-cash vouchers - exemptions - provided by third party other than employer
Section 10ZB Social Security Contributions & Benefits Act 1992
Regulation 25 and paragraph 8 of Part 5 of Schedule 3 Social Security (Contributions) Regulations 2001
NIM02416 shows the types of non-cash voucher (see NIM02413) that are specifically disregarded in calculating an employee’s earnings for Class 1 NICs purposes. Since 6th April 2000, where from that date:
- a third party provides an employee, irrespective of the level of their earnings, with a non-cash voucher, and
- that provision has not been arranged or facilitated by the employer,
then:
- the non-cash voucher is disregarded for Class 1 NICs purposes; but
- a Class 1A NICs liability will arise on the cost of the provision of the non-cash voucher. See NIM16357 for guidance on the Class 1A NICs position.
The following table summarises the position of third-party provision from April 1999.
| Tax year | Class 1 liability? | Class 1A liability? | Liable party? | Further information |
|---|---|---|---|---|
| 1999/00 | Yes | No | Employer | NIM02412 |
| 2000/01 | No | Yes | Employer, but the third party may choose to pay if it wishes | NIM16350 - NIM16366 |
| 2001/02 onwards | No | Yes | Third party | NIM16350 - NIM16366 |