877.Section 75 concerns the provision of benefits in kind (BIKs) to employees by somebody other than their own employer – a third party. The new measure only operates where the employer has not arranged or facilitated the provision of the BIKs.
878.In the case of a third party provider, the term “benefits in kind” includes non-cash vouchers, which will be moved from a Class 1 to a Class 1A NICs liability in regulations.
879.The section moves the liability for Class 1A NICs on third party provided BIKs from the employer to the third party.
880.On Royal Assent this provision takes retrospective effect to 6 April 2000. In the first year the third party may choose to meet the Class 1A liability on BIKs he provides. From 6 April 2001 the Class 1A liability becomes compulsory on the third party provider.
881.Subsection (1) introduces new sections 10ZA and 10ZB into the Contributions and Benefits Act.
Part IV: National Insurance Contributions Commentary on Sections Section 75: Third party providers of benefits in kind: GB