The option to pay employees flat rate subsistence expenses tax-free can be an attractive one; the employees are clear on what expenses will be paid, and the employer is saved the work involved in reimbursing the actual amounts incurred.
In most cases, employees will be able to claim back any expenses that they incur in doing their job from their employer. However, where the employer will not reimburse the employee’s expenses, there may be tax relief to be had.
The Christmas party is an annual tradition for many companies, but the frivolities would be somewhat reduced if the employees are left with a tax bill as a reminder of the evening. So what can be done to ensure that the Christmas party remains tax-free?
The old dispensation regime came to an end on 5 April 2016 to be replaced with a new statutory exemption for qualifying paid and reimbursed expenses. The new exemption applies for 2016/17 and later tax years.
If you are an employee, you may spend your own money on things that are related to your job. Where this is the case, you may be able to claim tax relief.
