EmployeeExpenses

Employees often incur costs while carrying out their duties, such as travel, subsistence or equipment, and employers can reimburse these without necessarily triggering a tax charge, provided the expense is wholly, exclusively and necessarily for business purposes. Keeping clear records and receipts is essential to demonstrate that reimbursements meet the qualifying conditions and to support the figures if HMRC ever asks questions.

Where expenses don't meet the strict business-only test, or where round-sum allowances are paid instead of reimbursing actual costs, a tax and National Insurance liability can arise for the employee, along with reporting obligations for the employer. Having a clear, consistently applied expenses policy reduces the risk of errors, and we're happy to help you set one up.