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HMRC internal manual

Compliance Operational Guidance

From
HM Revenue & Customs
Updated
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Supporting Guidance: employer compliance: guidance by subject: working rule agreements (WRA): disagreement on caravan accommodation payments

If you are unsure whether the lodging allowance actually paid should be paid without deduction of tax and NICs in respect of:

  • employer provided caravan accommodation COG930730 or
  • employee provide caravan accommodation COG930740 
  • or the employer disagrees with your view

you should consult the SO Team Leader, via the HO Team Leader on the rate that can be paid tax and NIC free.

Where all or part of the payments actually made are liable to deductions of tax and NICs you should

  • explain to the employer that as the tax and NIC free payment of lodging allowance under a WRA is concessionary, HM Revenue & Customs is not prepared to agree that the amount actually paid by the employer can be paid gross because the employees are not incurring matching expenditure
  • advise the employer of the rate that may be paid without deduction of tax and NICs.
  • advise the employer how to make any necessary open year adjustments COG906520 based on the difference between the amount paid and the amount considered allowable, and
  • seek recovery where appropriate, for closed years on the same basis.