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HMRC internal manual

Employment Income Manual

Removal or transfer costs: relocation companies: management fees

Part 4 Chapter 7 ITEPA 2003

Employers relocating employees may engage the services of a relocation company to provide a package of removal services for them. Typically such a package will include estate agency and legal services, transport of belongings, and other services that will be eligible removal benefits if they meet the criteria set out in EIM03108 onwards. The employer will normally pay a management fee to the relocation company as well as reimbursing the company’s costs. The management fee is part of the cost to the employer of providing the removal benefits and where those benefits qualify for exemption the management fee will also qualify.

To decide how much of the management fee is eligible you need to look at the contract between the employer and the relocation company. In the absence of agreement or other evidence apportion the management fee on the basis of the costs of the expenses and benefits contained in the particular removal package. For further guidance see the example at EIM03129.