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14A.4.3    Gifts: Sporting Achievements

Payments which have escaped section 62(19) include those made to relieve poverty,⁶⁴ as a mark of personal esteem, or to mark some particular occasion, such as the passing of an examination.⁶⁵

14A.4.3.1    Taxable Gifts

The mere fact the donor is not the employer does not prevent the gift from being an emolument; the question is whether the payment is made because of the services rendered by the employee in the course of his employment. On this basis, Atkinson J held, long ago in 1947,⁶⁶ that a tip to a taxi driver was taxable, but added that a tip of £10 would not be taxable if it was paid at Christmas or when the driver was going on holiday and was intended to acknowledge the driver’s qualities and faithfulness rather than as a reward for regular service.⁶⁷ However, as always, the question is one of the fact and degree. Christmas presents will be taxable if they are customary or indiscriminate.⁶⁸ There is an exemption from tax for gifts from third parties which are emoluments up to £250 p.a.⁶⁹

14A.4.3.2    Tests

In Moorhouse v Dooland Jenkins LJ stated four principles:⁷⁰

1. The test of liability to tax on a voluntary payment made to the holder of an office or employment is whether, from the standpoint of the person who receives it, it accrues to him by virtue of his office or employment or, in other words, by way of remuneration for his services.

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