Train refunds - are they taxable

Business travel rail refunds. What happens if I keep them and not refund my employer?

Didn't find your answer?

Like a lot of us I was delayed on a train the other day. I bought the ticket although I was travelling on business for my company.

Trans Pennine Express insisted in refunding me the traveller so I have now got the money from them.

So if I keep the money and not refund the business I am liable to tax and national insurance?

Replies (17)

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By SteveHa
06th Sep 2018 08:39

Have you claimed reimbursement from the company?

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Replying to SteveHa:
Michael Whiteley
By Michael John Whiteley
06th Sep 2018 11:55

Thanks for your input. I will be re-imbursing the company so all tax neutral except that if claims were substantial I would only pay PAYE whereas if the company paid me out as a dividend I would incur Income Tax and Dividend Tax.

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By ms998
06th Sep 2018 09:47
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By Accountant A
06th Sep 2018 10:16

ms998 wrote:

This conversation may help as it is similar.

https://www.accountingweb.co.uk/any-answers/flight-compensation-on-busin...

I don't know what the "compensation" from the train operator is supposed to represent. Flight delay claims are specifically personal compensation.

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By Accountant A
06th Sep 2018 10:26

If the refund is just that, then I'd say it belongs to the company. Effectively, the train operator is saying it hasn't charged you (netting off refund) because of the inadequate service.

If the amount is worth arguing the toss about, examine the terms under which the refund has been made.

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By SteveHa
06th Sep 2018 10:24

Except, it's not compensation, is it. It's simply a refund. That being the case, if it's already been reclaimed from the company, then it should, in turn, be reimbursed to the company.

If it hasn't been reclaimed, then it shouldn't be. In both cases, it's entirely tax neutral.

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Replying to SteveHa:
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By ms998
06th Sep 2018 11:00

If you’re travelling on one of our services and have been delayed by 15 minutes or longer, you are entitled to claim compensation under our Delay Repay scheme (except when delays are caused by planned engineering works).

https://www.southwesternrailway.com/contact-and-help/refunds-and-compens... - Southwestern reckons its compensation

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By Ruddles
06th Sep 2018 10:54

Simple - what do you mean when you say "I" bought the ticket?

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By Justin Bryant
06th Sep 2018 11:08

Most people would rail against this I think.

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By spidersong
06th Sep 2018 12:46

Let's try to stay on track shall we.

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Replying to Justin Bryant:
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By Dib
06th Sep 2018 13:17

I don't think this is the appropriate platform for puns!

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By spidersong
06th Sep 2018 16:48

It looks like this may be a tender subject, by all means let off some steam and signal your disaproval but stick to the points.

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Replying to spidersong:
By SteveHa
06th Sep 2018 20:24

Not to derail the sub-thread, but do we have a definitive answer?

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Portia profile image
By Portia Nina Levin
06th Sep 2018 13:18

If the company reimburse you more than the expense that you incur, then that is taxable as employment income and is liable to national insurance.

The expense incurred, to my mind, is the amount by which you are out of pocket; being the cost of the ticket less the amount reimbursed.

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Replying to Portia Nina Levin:
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By Justin Bryant
06th Sep 2018 13:26

As usual, your answer is very far from being just the ticket.

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Melchett
By thestudyman
06th Sep 2018 15:15

Like flight delays, it is classed as compensation, not a refund.

The compensation should go to the traveller and not the company. The service is still being run. The travel companies provide the reason that it is the individual who suffers the distress/stress associated with a delay.

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By pauljohnston
10th Sep 2018 11:07

Thanks to the study man for signalling the way.

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