- Contrast the employee who receives a salary and, in
addition, some non-convertible benefit, such as necessaries, in respect
of which extra benefit there is no tax, with another employee who receives
a salary and has to pay out of that salary a counter amount to secure
the same necessaries.35 The latter is assessable on the total salary and
not entitled to deduct the cost of those necessaries unless they come
within the strict test laid down by ITEPA section 336 (TA 1988 section
198.)36
- Consider the borderline between the rule in Tennant v Smith
and that in Nicoll v Austin. If an employer buys each employee
a new suit at Christmas, all the employees are taxable, but only on
the second hand value of the suit37
(Tennant v Smith). If, however, they have already bought their
suits but not yet paid for them and the employer settles the debts for
them, they are taxable on the amount paid to the tailor (Nicoll
v Austin). The question of whose is the liability to be
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