In Reed Employment plc v HMRC (and related appeals) (No 4) (TC01727 – 19 January) several associated companies carried on businesses as employment bureaux. They paid allowances to employees to cover travelling expenses. In 1998 a Revenue officer granted a dispensation under which the companies were not required to account for PAYE and NICs. HMRC subsequently formed the opinion that the dispensation should have not been granted and in 2006 it revoked it. The companies continued to pay the allowances without accounting for PAYE and in 2007 HMRC issued determinations under Income Tax (PAYE) Regulations SI 2003/2682 reg 80. The companies appealed. The First-tier Tribunal reviewed the evidence in detail and dismissed the appeals holding that the allowances were payments of earnings intended to reimburse ordinary commuting expenses and that the companies should have accounted for tax throughout the...
