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Guidance on employment intermediaries’ travel expenses

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HMRC has published guidance for inclusion in the Employment Status Manual on the new rules, effective from 6 April 2016, restricting tax relief for home-to-work travel and subsistence expenses for workers engaged through employment intermediaries. These rules are currently contained in Finance Bill 2016 (cl 14).

Owing to a drafting error, the legislation inadvertently requires intermediaries such as umbrella companies to apply IR35, rather than the ‘supervision, direction or control’ test to determine whether the new rules apply. HMRC has confirmed that the legislation will be amended ‘at the earliest opportunity’ to give effect to the government’s original intention that, in most cases, the supervision, direction or control test should be used.

Where the legislation applies, each engagement will be treated as a separate employment for the purposes of obtaining relief for travel and subsistence expenses. See

Issue: 1307
Categories: News