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HMRC internal manual

Employment Income Manual

Exemption for amounts which would otherwise be deductible: Dispensations

S65 ITEPA 2003

For periods prior to 6 April 2016 see eim30050.

From 6 April 2016 the legislation for dispensations at s65 ITEPA 2003 is being repealed and dispensations will cease to exist.  Employers wishing to pay or reimburse employees expenses after 5 April 2016 will be able to do so without deducting tax or NICs from those payments where the expenses would qualify for a deduction and meet the conditions for payment.

The legislation will, however, still allow for retrospective revocation of dispensations for periods prior to 6 April 2016 where the employer has failed during that period to adhere to the terms of their dispensation and this is not established until after 6 April 2016.  See eim30095