UUÂãÁÄÖ±²¥

Scholarships


Produced by Tolley in association with
Employment Tax
Guidance

Scholarships


Produced by Tolley in association with
Employment Tax
Guidance
imgtext

Introduction

A number of employers make educational awards to individuals. For the individuals receiving the award, there is an exemption from tax in most instances. However, depending on the relationship between the individual and the employer, there may be a taxable benefit arising.

The main purpose of the legislation is to ensure that, where employers are providing a benefit to employees by meeting the employee’s child’s education costs, this will not be exempt as a scholarship. If these amounts had been provided by way of cash to the employer then it would have been taxable, therefore meeting their child’s school costs on their behalf should equally be taxable. See the School fees guidance note.

Scholarships

There are a number of scenarios to understand when looking at the taxable status of the payments.

HMRC’s guidance on scholarship income is at EIM06205–EIM06275.

The scholarship holder is a third party to the employer

There is a general exemption from income tax for a scholarship under ITTOIA 2005, s 776 if the person receiving the scholarship is in full time education.

Access this article and thousands of others like it
free for 7 days with a trial of Tolley+™ Guidance.

TAKE A FREE TRIAL
Philip Rutherford
Philip Rutherford

Senior Tax Director at Molson Coors Brewing Company

Phil is the Senior Tax Director for Molson Coors' European operations. He has responsibility for both direct and indirect taxes across both EU and non-EU states. Prior to this, Phil was responsible for Molson Coors UK tax affairs covering all major taxes and duties.   Phil trained at KPMG LLP, where he worked for 8 years, specialising in tax investigations across both direct and indirect tax.

Powered by
  • 10 Jul 2024 10:31

Home/ Tolley Tax Guidance/ Employment Tax / Providing benefits to employees

Popular Articles

Employment Tax

Subsistence expenses

Subsistence expensesIntroductionSubsistence is the amount incurred as a consequence of business travel. Typically it relates to accommodation and meal costs incurred. These amounts are allowed because they are associated with the necessary travel which is not to a permanent workplace. See the Travel

14 Jul 2020 13:43 | Produced by Tolley in association with Philip Rutherford Read more Read more
Employment Tax

Loans written off

Loans written offCompanies sometimes provide directors, employees or shareholders with low interest or interest-free loans either as part of the reward package or on special occasions to help the individual meet significant expenditure. The employment income implications of these loans are discussed

14 Jul 2020 12:11 | Produced by Tolley Read more Read more
Value Added Tax

Exemption ― overview ― items exempt from VAT in the UK

Exemption ― overview ― items exempt from VAT in the UKVAT exemption: list of supplies exempt from UK VATThe goods or services that are exempt from VAT are listed under various group headings within VATA 1994, Sch 9, Pt II.It is important to remember that not all supplies that come within a heading

14 Jul 2020 12:45 | Produced by Tolley Read more Read more