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Can expenses be paid tax free?

Tax free expenses to employees

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I am fully aware of the rules on receipted expenses and mileage allowance and have been reading up on applications for claiming an exemption in relation to expenses for food and accommodation allowance but we have a client in construction who is adamant that his competitors are paying employees £100 per week travel allowance tax free and won't accept my answer that this is not allowed. Is there something I am missing? 

He also states that the norm is to pay £35 per night for overnight allowance which I will be looking into as part of the exemption, however he has informed me that a good few of the lads sleep in their vans while working away and therefore any checks carried out would show no actual expense incurred and therefore am I right in thinking this allowance would not be acceptable.

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By paul.benny
16th Sep 2020 10:14

Just because it's not allowed, doesn't mean that people aren't doing it.

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By lesley.barnes
16th Sep 2020 11:56

Are you sure that the competitors are talking about employees and not subbies? You mention their vans that they sleep in - surely these are company vans if they are employees and therefore they wouldn't be entitled to travel allowances and possible benefits in kind implications. Could the competitors be paying travel and hotel allowances to subbies and not including them in the CIS deductions? Its still not right if that's the case and whole different discussion, It could be your client has got the wrong end of the stick.

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Replying to lesley.barnes:
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By groundy
16th Sep 2020 13:44

Definitely employees but use their own vans not companies. These are construction workers that work short term contracts depending on the site and move from one employer to the next frequently.

I do have concerns that our client is confused as to what his competitors are doing but he is adamant that he is correct.

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By Sandnickel
16th Sep 2020 12:57

https://www.gov.uk/hmrc-internal-manuals/employment-income-manual/eim66205

Maybe this? I realise you said construction and this relates to haulage, but the amounts are just too similar to be coincidental.

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By vinylnobbynobbs
16th Sep 2020 15:48

The Construction Industry does have agreements with HMRC about certain expenses being tax free such as site travel

https://www.fmb.org.uk/media/10195/constitution-and-working-rule-agreeme...

HMRC Manual

https://www.fmb.org.uk/media/10195/constitution-and-working-rule-agreeme...

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By tonyaustin
21st Sep 2020 10:48

The employer may have agreed a scale rate with HMRC
https://www.gov.uk/expenses-and-benefits-cash-sum-payments/scale-rate-pa...

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By paulclewlow
21st Sep 2020 14:47

Lorry drivers have a tax free (and NI free) rate agreed with HMRC for any night spent away from home.
They get £26.20 if the lorry has a "sleeper" cab and £34.90 per night if it does not.
I would not be surprised if other industries had similar tax free arrangements.

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