318A(1) If conditions A to D are met in relation to the provision for an eligible employee of care for a child–
(a)no liability to income tax arises by virtue of section 62 (general definition of earnings), and
(b)liability to income tax by virtue of Chapter 10 of Part 3 (taxable benefits: residual liability to charge) arises only in respect of so much of the amount treated as earnings in respect of the benefit by virtue of section 203(1) or 203A(1) (as the case may be) as exceeds the exempt amount.
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