As noted at ¶9090, a benefit is charged as earnings if it is money or money’s worth, which includes things that are of direct monetary value to the employee.

Where an employer discharges a debt owed by an employee to a third party, the employer’s payment is of direct monetary value to the employee because he no longer has to pay the third party. This is known as the pecuniary liability principle because the employer bears the employee’s pecuniary liability. The payment by the employer counts as money’s worth and will be taxed as earnings if it comes from the employment. The employee is taxable on the cost to the employer.

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