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Employee benefits and expenses

Date: 27th February, 2014   |   Author: Cathy Corns   |   Comments: 0

The Office of Tax Simplification (OTS) has issued its second report on employee expenses and benefits.  The issues on accommodation benefits and termination payments have been deferred to a future report.  The report’s recommendations include:

  •  Voluntary payrolling of benefits.
  •  Broadening PAYE settlement agreements to cover any tax liabilities on expense and benefits.
  •  An exemption for qualifying business expenses, to avoid the need for dispensations or for the employee having to declare the reimbursements on P11Ds and the employee claim a deduction.
  •  Introduce a trivial benefit limit.  Payments below this would be exempt.

On travel and subsistence:

  • Either provide that an employee can have only one permanent workplace, or redefine “permanent” and “temporary” workplaces;
  • Have a specific regime for homeworkers with a flat rate tax free allowance.

It will be interesting to see which of these are taken up.


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