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Detail of outcome
At Autumn Budget 2017, the government announced reforms to the taxation of employee expenses in response to the specific concerns raised in the call for evidence. It will:
consult in 2018 on extending the scope of tax relief currently available to employees (and the self-employed) for work-related training costs
remove the requirement for employers to check receipts when making payments to employees for subsistence using benchmark scale rates from April 2019
place the existing concessionary accommodation and subsistence overseas scale rates on a statutory basis from April 2019
work with external stakeholders to explore possible improvements to the guidance on employee expenses, particularly on travel and subsistence, and the process for claiming tax relief on non-reimbursed expenses
This response document highlights the issues raised in the call for evidence and why the government has decided to focus on these areas.
At Spring Budget 2017, the government confirmed the Autumn Statement announcement that a call for evidence would be published to better understand the use of the income tax relief for employees’ business expenses, including those that are not reimbursed by their employer.
The main objectives of the call for evidence are to understand:
- if the current rules or their administration can be clearer and simpler
- whether the tax rules for expenses are fit for purpose in the modern economy
- why the cost to the exchequer of the tax relief for expenses which are not reimbursed has increased
The call for evidence is seeking views on:
- current employer practise on employee expenses
- current tax rules on employee expenses
- the future of employee expenses
The government will use the information gathered from this call for evidence to inform potential future policy development. No decisions have been made about the issues set out in this document.