Commentary on Sections Example 3 Ne = £5,000; Da = 183; De = 183; Smg = 0 Section 321: Suggestion awards
1348.This section provides that no liability to income tax arises where awards which do not exceed the limits set by section 322 are made under a suggestions scheme.
1349.It derives from ESC A57. See Change 78 in Annex 1.
1350.Subsection (1) sets out the type of scheme to which the section applies.
1351.Subsection (2) provides that no liability to tax arises on an encouragement award or a financial benefit award (defined in subsection (6)) which meets the three conditions in subsections (3) to (5), to the extent that it does not exceed the limits set by section 322.
1352.Subsection (6) defines “encouragement award” and “financial benefit award”.