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HMRC internal manual

Employment Income Manual

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HM Revenue & Customs
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Other expenses: assistant's wages: amount of deduction to be given

In certain unusual circumstances a deduction may be given under Section 336 ITEPA 2003 for assistant’s wages, see EIM32415. You should examine cases particularly critically where the payments are made to a relative of the employee or to a person who is otherwise connected with the employee.

Firstly, you should consider whether the amount paid is appropriate for the nature and amount of work performed. Is the amount paid excessive?

Secondly, you should check in appropriate cases that the wages have actually been paid. It is not enough, for example, for an employee to contend that the wages were paid to his or her spouse or partner as part of the weekly housekeeping.

You should not allow any deduction where the wages are excessive or have not been paid.

If wages have been paid you should consider whether PAYE has been operated, see EIM32425.