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Readers’ forum: Employee subsistence

13 July 2021
Issue: 4800 / Categories: Forum & Feedback
Treatment of expenses in excess of HMRC scale rates.

I am aware of the HMRC published benchmark scale rate payments for subsistence for both UK and overseas travel which can be paid without incurring a tax and National Insurance liability for qualifying business travel.

HMRC’s Employment Income Manual states no sampling checks need to be made but evidence needs to be retained that the expenses are paid for qualifying journeys. However can readers clarify from their experience what kind of evidence might be accepted by HMRC?

The manual also states that where expenses are paid in excess of HMRC scale rates the excess is liable to tax and National Insurance. However the guidance also states that round sum expenses payments are liable to tax and National Insurance in full.

But at what point is an expense treated as a round sum? If for example a union has negotiated subsistence rates which...

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