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HMRC internal manual

Employment Income Manual

HM Revenue & Customs
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Employment income: incidental overnight expenses: example


An employee stays in a hotel for one night as part of a business trip. His employer pays him an allowance of £6 to cover incidental expenses.

The employee is taxable on the whole of the £6 unless £1 is reimbursed within a reasonable time. The £6 cannot be paid tax free under the incidental overnight expenses legislation because it exceeds the permitted amount, see EIM02730.