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HMRC internal manual

National Minimum Wage Manual

Deductions and payments from workers: payments from a worker to a third party

Relevant legislation

The legislation that applies to this page is as follows:

* National Minimum Wage Regulations 2015, regulation 13(b)

Where a worker makes a payment to third party, it will reduce their national minimum wage pay if the payment is:

  • in respect of expenses the worker has incurred in connection with carrying out the employment (NMWM11100) and
  • not then reimbursed by the employer.

Example 1 - a worker buys a train ticket to travel on business; he is not reimbursed this expense. The payment made by the worker will reduce national minimum wage pay.

Example 2 - a worker buys petrol to put in the work’s van to travel on business. He puts in a claim for repayment of the cost of the fuel, and the employer makes a payment.

The payment to the third party will not reduce national minimum wage pay, the payment made to reimburse the expense will initially count towards national minimum wage pay but will then be reduced from the calculation (NMWM09170).

Example 3- A worker purchases tools which are specifically required by his employer to perform his work. The payment the worker makes to the third party will reduce national minimum wage pay.

Care must always be taken to ensure the tools are purchased as a requirement of the work, rather than by choice.

For deductions from pay, which the employer then pays to a third party, see NMWM11180.