Tax exemption for travel expenses of members of local authorities 13 July 2015
From April 2016 there will be a new exemption from Income Tax and a disregard for National Insurance contributions for travel expenses paid to councillors by their local authority.
This measure will have effect on payments made on and after 6 April 2016.
Legislation will be introduced in Summer Finance Bill 2015 to amend Part 4 of ITEPA to exempt payment of councillors’ travel expenses from a charge to income tax. This will include expenses paid for journeys between the councillor’s home and permanent workplace, except where the councillor’s home is more than 20 miles from the boundary of the local authority area. The current rules for MAPs, AMAPs and MAR will continue to apply to business travel undertaken by a councillor in their own vehicle. Journeys between a councillor’s home and permanent workplace, where their home is either in the local authority area or within 20 miles of the boundary of the area, will be treated as business travel when calculating MAPs and applying the AMAPs limits, but will not be treated as business travel for calculating MAR. The tax exemption will also apply to qualifying passenger payments up to the approved amount, but only where the passenger is also a member of the local authority. The exemption will only apply where payments are made by a local authority under certain provisions. Treasury Regulations will set out relevant definitions and the provisions that payments must be made under.
Amendment will also be made to the Social Security (Contributions) Regulations 2001 (SI2001/1004) to give effect to these provisions for Class 1 NICs purposes.
For further details see Tax exemption for travel expenses of members of local authorities .
Five year rail fares deal will save commuter costs 20 August 2015
The government is putting an end to above inflation fare increases with a five year hold on regulated rail fares.
The move extends the cap put in place in 2014 and 2015 and will keep regulated rail fare increases at Retail Prices Index (RPI) inflation and no more for the life of this Parliament.
Figures just released by the Office of National Statistics (ONS) show that the RPI figure for July, which is used by the government to calculate regulated fares for the following year, was 1%. This means that no regulated rail fares will rise by more than that figure in 2016, making it the lowest fare increase since 2010.
It also means that for the first time since 2003, people’s earnings are on average rising more quickly than fares. Latest figures show that earnings are increasing by 2.4%.
Rail Minister Claire Perry said:
“As part of our long-term economic plan, we are investing record amounts in transforming the UK’s rail network in order to provide better journeys for everyone, and fares have an important role to play in delivering this investment. But I know that many families are concerned about the cost of rail travel, which is why we are putting an end to above inflation fare increases. This will make a real difference to household budgets, saving season ticket holders around £425 each over the next five years.”
In September 2014 the government also announced that train operating companies are no longer able to use a “flex” rule to raise some individual fares by up to 2% more than the permitted average increase.
The fares passengers pay will continue to support the biggest rail modernisation programme for over a century, with £38 billion in spending to improve the network in the 5 years to 2019. The investment is set to deliver crucial benefits for passengers, including relief from crowding on some of the nation’s busiest routes.
CIPP comment The CIPP welcome this move as it will clearly aid many employees and in turn the many employers who provide beneficial loans to assist with season tickets.
CIPP Policy News Journal
25/04/2016, Page 142 of 453
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