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MPs - additional costs allowance and other expenses

I searched on HMRC website for references to the "additional costs allowance". The only showings are in the guidance pages relevant to MPs self assessment tax returns. There's no published reference in HMRC manuals.

The Parliament notes on page MPN 2 state that MPs should not include in Box 1 any "benefits and expenses payments received". These should be enter instead in boxes 3 to 9.

The form continues much as you might expect except that it explicitly instructs MPs to exclude any sums received by way of the 'Additional Costs Allowance.'

Now we all know that HMRC guidance is not necessarily the law. So what is the law as regards this allowance? WE can all speculate - and some may well do so.

But I'd love to hear from anyone who currently acts for MPs (or has done in the past).
If you'd rather not publish a reply publicly, please call me direct on 07769 692890.

Mark Lee
Tax Advice Network
Mark Lee


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By Anonymous
15th May 2009 23:05

Section 292 - is it strictly enforced?
My MP who represents a constituency outside London lives just over the border in a neighbouring constituency. This would seem to make any expenses on this home taxable - I hope he only claims for his London home. Also if an MP visits his constituency purely for a political party function surely this is not 'performing parliamentary duties' and any resulting expenses become taxable.

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15th May 2009 17:37

Section 292?


Have you considered section 292 of the Income Tax (Earnings and Pensions) Act 2003?

292 Overnight expenses allowances of MPs

(1) No liability to income tax arises in respect of an overnight expenses allowance paid to a Member of the House of Commons in accordance with a resolution of that House.

(2) “Overnight expenses allowance” means an allowance expressed to be in respect of additional expenses necessarily incurred by the Member in staying overnight away from the Member’s only or main residence, for the purpose of performing parliamentary duties—

(a) in the London area, as defined in such a resolution, or

(b) in the Member’s constituency.


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By kdbr
15th May 2009 17:33

As far as i know these are not reported on the P11D. Presumably there is a dispensation in place on the basis that HMRC are satisfied that the employer is reimbursing only bona fide business expenses.......

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