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E4.1054 The charge to tax

Where the charge to tax applies by reason of a relevant step, the value of the relevant step (see below) counts as employment income of A in respect of A's employment with B (A and B being the persons referred to in E4.1052)¹:

1. Ìý

   •ÌýÌýÌýÌý if the relevant step is taken before A's employment with B starts, for the tax year in which the employment starts, or

2. Ìý

   •ÌýÌýÌýÌý otherwise, for the tax year in which the relevant step is taken

Where the relevant step counts as employment income of more than one person, it is to be apportioned on a just and reasonable basis².

If the amount which is treated as earnings would also be treated as earnings under the benefits code the disguised remuneration charge takes priority. Similarly any income which would be dealt with under the distributions provisions in ITTOIA 2005, Pt 4, Ch 3 (ss 382–401C) (see Division E1.4) is to be dealt with under the disguised remuneration legislation³.