Commentary on Sections Example 3 £150(Pe) – £50(E) = £100 Section 88: Year in which earnings treated as received
333.This section gives the timing rules for the receipt of the amount treated as earnings. It derives from section 141(1) and (2) of ICTA.
334.Subsection (1) deals with non-cash vouchers other than cheque vouchers. In most cases the cost of provision will have been incurred before the voucher is received. The earnings will therefore be treated as received in the year in which the employee receives the voucher. If that is not the case and the cost of provision is incurred at a later time, the amount will not be known. That may cause a particular problem if the amount cannot be ascertained until a tax year after the voucher is received. This section defines the receipt for the purposes of sections 19 and 32 of this Act as being at the time the cost is known.
335.Subsections (2) and (3) are provisions specific to cheque vouchers which provide a similar rule to that for other non-cash vouchers.