Change of work base

Sevren

It's been one of those afternoons where you spend ages on the HMRC website - only to phone them and end up where you started.

If an employee's work base is permanently moved 25 miles away from the original place of work - it would seem that any allowance paid for additional mileage is taxable - even reimbursement of public transport.

Anyone got any experience to back this up or alternatives ?

Thanks as always.

JodieR

There's something in the back of my head saying that it's not taxable for the first 6 months after the move, but I can't find any evidence to support that, sorry!
Why don't you try the Croner support line?
Jodie

JodieR

Mind, there's the £8500 tax free reallocation costs which the employer can pay to cover costs of moving house and associated travel expenses, but this is only allowable 'where it would be unreasonable to expect the employee to work at the new location without moving nearer to it'. So this suggests that if the employee doesn't move house that anything paid to them would be taxable.

Poodle

Sevren,

If there is a mobility clause in the contract and the move is to an alternative, permanent work place as you say then there will be no tax relief available on any additional payments made by the employer to the employee as compensation for the extra travelling as this will be for 'home to place of work'. travel.

There is a tempoary workplace rule http://www.hmrc.gov.uk/manuals/eimanual/EIM32080.htm and you could have a look around this set of guides.

But, you have said that this will be permanent and so I would say no.

If the employer is feeling guilty and would like to reimburse the employee for the extra cost then work out the cash equivilant and add to salary for PAYE and NI deductions

Alternatively if the employer wishes to suffer the total cost then you could go for a PAYE settlement agreement.

Poodle

Sevren

Many thanks for your responses - like Jodie - I had in the back of my mind that there was some sort of relief but having now spoken to HMRC it would appear not !

Many thanks