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The new dispensation-free world of expenses that employers face from 6 April 2016.
KEY POINTS
- Generally business expenses will be exempt from tax if they are tax deductible.
- The form P9D for ‘lower paid employees’ and dispensations is abolished.
- A new ITEPA 2003 Part 4 Ch 7A will exempt amounts that would otherwise be deductible.
- Round-sum allowances will be exempt if calculated and paid in an approved way.
- Steps taken to curb abuse of travel and subsistence rules.
- New ITEPA 2003 s 339A means that most engagements under the overarching contract through an intermediary are treated as separate employments.
How often have we heard: ‘It’s not wages it’s expenses.’ Followed by ‘and expenses aren’t taxable.’ It’s an ineffective wheeze possibly even evasion (see for example Napier v National Business Agency Ltd [1951] 2...
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