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HMRC internal manual

Employment Income Manual

HM Revenue & Customs
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Employment income: incidental overnight expenses: tactical advice


Compliance work in relation to incidental overnight expense payments will commonly focus on the amounts paid or reimbursed by employers, in order to police the tax free limits. However, there are other parts of the legislation that should also be checked.

Wholly and exclusively

A payment can only be tax free if it is made wholly and exclusively for the purpose of defraying expenses that are incidental to the employee’s being away from home. If the payment is made for some other purpose, for example as remuneration, it will not be exempt under this legislation.


The payment is only exempt if it is made for a period during which the employee is absent from the place at which they normally live. Some employees do not have a place at which they normally live. For others, the place at which they normally live may be the place at which they are staying during the business trip, see example EIM31817. In these cases the payment will not be exempt.