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HMRC internal manual

Employment Income Manual

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HM Revenue & Customs
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Removal or transfer costs: qualifying expenses and benefits: main conditions for exemption: extension of time limit: examples

Section 274 ITEPA 2003

Children on examination courses

The Commissioners of HMRC may extend the date by which relocation costs may be incurred for the purposes of qualifying for the £8,000 exemption (see EIM03105).

This function is delegated to Grade 7 Team Leaders where an employee’s relocation is delayed to allow a child or children to complete public examination courses such as GCSEs and A Levels. The following paragraphs provide further guidance in this area.

The normal case

The first consideration in such cases is to establish the date when the employee’s circumstances at work changed, and ensure that a child was at that date involved in a course that had not been completed. Where this is so it is usual to extend the time limit to 5 April next following completion of the course.

Other considerations

In the examples that follow it is assumed the employee was transferred to a new location in March 2003, in which case the limitation day for incurring relocation costs is 5 April 2004.

Example 1

The employee’s child was attending a GCSE course between September 2002 and June 2004 and then was due to move on to an A level course between September 2004 and June 2006.

Here you would normally extend the time limit to 5 April 2005. It is not necessary to take account of another course that starts after completion of the first course. The employee had 18 months to September 2004 to arrange for the change of residence.

If this could not be accomplished between June and September 2004, the legislation helps by including as eligible for exemption travel and subsistence costs for a child who temporarily goes ahead to the new location or is left behind at the old location for the purposes of securing continuity in education.

Example 2

The employee’s child was attending a GCSE course between September 2002 and June 2004 and intended to move on to A Levels from September 2004 to June 2005. His other child was on a GCSE course between September 2003 and June 2005 and intended to do A Levels between September 2005 and June 2007.

Where an employee has two or more children it is possible for a second course to start before the first course ends and then for a third course to start before the second course ends. Indeed there may be a series of overlapping courses.

In HMRC’s view it is reasonable to expect a child who is in the middle of a public examination course to stay on in the same educational establishment. In this example, uncompleted courses overlap to the extent that it would be reasonable to extend the time limit to 5 April 2008.

Example 3

The employer’s child was attending a GCSE course between September 2003 and June 2005.We accept it will not always be possible for an employee to make a change of residence before a child commences a public examination course.

If the employee is unable to sell the old residence between March and September 2003 and the child has to continue her education at the old location it will be reasonable to extend the time limit on account of both the selling delay and the child’s education.

There are no hard and fast rules to say what is reasonable since much depends on the length of the selling period available, market conditions, and the effort the employee puts into changing residence. The less time available between the date the employee’s work location changes and the start of the child’s examination course, the more reasonable it will be to extend the time limit.

(This content has been withheld because of exemptions in the Freedom of Information Act 2000)

(This content has been withheld because of exemptions in the Freedom of Information Act 2000)