The Chartered Institute of Payroll Professionals ……………………………………………………………Policy News Journal
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Benchmark Scale Rates for inward assignees 23 August 2016
The 15 hour scale rate can now be applied to inward assignees subject to them meeting the qualifying conditions and provided that there is a robust checking system in place.
Exemption for amounts which would otherwise be deductible: Payments at a benchmark rate
The income Tax (Approved Expenses) Regulations 2016. (SI 2015/1948)
For periods prior to 6 April 2016 see EIM30050 .
Employers wishing to pay or reimburse expenses may use the benchmark rates set out in the Income Tax (Approved Expenses) Regulations without needing the prior approval of an officer of Revenue & Customs.
The regulations set out the rates which employers can use for payment or reimbursement of employees expenses where the relevant qualifying conditions are met. These regulations replace the previously published benchmark scale rates (See EIM05230 ) These rates are the maximum tax and NICs free amounts that can be paid by employers who choose to use the system. An employer can pay less than these rates if it wants to do so. If a higher payment or expense reimbursement is made without agreeing a bespoke scale rate with HMRC (see EIM30250 ), any excess over the published rate should be subject to tax and NIC’s. Although it will no longer be necessary to undertake a sampling exercise to establish that the amount paid is a reasonable estimate of expenses employees actually incur in these circumstances, employers will still need to have a checking process in place, (see EIM30270 ) and be able to demonstrate that they satisfy the travel and subsistence rules at Section 337 ITEPA 2003 (see EIM32350 onwards) and Section 338 ITEPA 2003 (see EIM32000 onwards).
Rates are set as follows:
Minimum journey time
Maximum amount of meal allowance
5 Hours 10 Hours
£5
£10 £25
15 Hours (and ongoing at 8pm)
Where a scale rate of £5 or £10 is paid and the qualifying journey in respect of which it is paid lasts beyond 8pm a supplementary rate of £10 can be paid to cover the additional expenses necessarily incurred as a result of working late. A meal is defined as a combination of food and drink and would take a normal dictionary meaning. Where employees are required to start early or finish late on a regular basis, the over 5 hour and 10 hour rate, whichever is applicable, can be paid provided that all the other qualifying conditions are satisfied.
Qualifying conditions - Benchmark scale rates must only be used where all the qualifying conditions are met. The qualifying conditions are:
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