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confusion nor uncertainty; whereas for those employers who choose to operate such schemes the effect of applying the Ramsay principle is to restore the certainty which the legislature intended.’ 164 |
The legislation includes rules about the timing of payments for PAYE.165 |
13A.4.2 Widening the Ambit by Legislation |
13A.4.2.1 Benefits |
Although PAYE was originally applied only to money payments it has since been extended to certain benefits in kind, notably cash vouchers (sections 693, 203I), non-cash vouchers (sections 694, 203G), credit tokens (sections 695, 203H) convertible assets (sections 696, 203F),166 but also enhancing the value of an asset (sections 697, 203FA) and share options etc, (sections 698–700, 203FB). Apart from these extensions, PAYE applies to almost all income within ITEPA including, therefore, pensions income and certain welfare payments;167 it therefore applies for example to payments of expenses and expense allowances within ITEPA part 3 chapter 3 and to any securities related income within part 7.168 On the use of coding to collect tax on benefits outside the PAYE system see below. |
13A.4.2.2 Payments by Others |
PAYE applies to certain payments by third parties. Where an emolument is paid by a third party, a deduction of tax under PAYE may still be required.169 There is also an express provision to allow the PAYE system to operate when there are organised arrangements for sharing tips and the person running the scheme is not the principal employer.170 PAYE may also apply to payments by an intermediary (section 203B).171 The concept of a payment by an intermediary is widely defined. PAYE also applies (section 203E) where a contractor hires employees of another person (the mobile UK workforce provision). This applies where the employee works for someone other than the employer and that someone, known as the relevant person, pays the employer; one or other of these will operate the PAYE system. The Revenue has the power to direct the relevant person to apply the system if it |