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New! Advisory day time subsistence rates
10/04/2009
Tyas & Company, Chartered Accountants serving Crawley, Gatwick, Horsham, East Grinstead and businesses in Sussex and Surrey
From 6 April 2009, employers can start agreeing dispensations with HM Revenue & Customs (HMRC) over day-time subsistence rates.
The following advisory scale rates can be paid employees without them having to account for how the money was spent.
Breakfast rate (irregular early starters only): up to £5 when an employee leaves home earlier than usual before 6am and purchases breakfast away from home. If the employee regularly leaves home before 6am the allowance does not apply.
One meal rate (five hour rate): up to £5 when an employee has been away from his or her home or normal place of work for a period of at least five hours and has purchased a meal.
Two meal rate (10 hour rate): up to £10 when an employee has been away from his or her home or normal place of work for a period of at least 10 hours and has purchased a meal or meals.
Late evening meal rate (irregular late finishers only): up to £15 when an employee finishes work later than usual after 8pm and has to buy a meal they would normally have had at home. If the employee regularly finishes work after 8pm the allowance does not apply.
The above rates can only be paid on the days an employee is necessarily working away from their permanent place of work, or necessarily staying away from home, and where they are working or staying is at least five miles or more from the employee’s permanent workplace or home.
Important note: HMRC is withdrawing the previous friends and family allowance. This applied when employees, for example, stay with a relative overnight. An allowance of up to £25 per night could be paid tax-free.
HMRC has reviewed this policy and concluded that there is no legal basis for giving tax relief because it is not linked to any specific underlying expense. Therefore, where this allowance is included in any existing dispensations it will be withdrawn when the dispensation comes up for review.
Tyas & Company, Chartered Accountants for businesses in Crawley, Gatwick, Horsham, East Grinstead, Sussex and Surrey
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