PayMatters Expense Dispensation

5 July 2009

PayMatters is pleased to announce that it has had its application for scale rate susbsitence payments accepted by its local tax office.

This welcome change in rules by HMRC removes the need for obtaining and submitting receipts for food and drink expenses incurred while working away from your normal workplace (i.e. while working at a clients premises) provided they are within the limits set.

In practice it now means that people working through PayMatters can claim up to £5 per day for food and drink (or £10 if you are out of your house for more than 10 hours (includes time spent travelling to and from the clients premises)). Please note you still have to verify that you have spent the at least the amount claimed and should only do so if you are buying a meal. Expenses should not be claimed if you are buying ingredients to make your own lunch.

Although you are not required to send Paymatters copy of receipts for subsistence claims up to the scale rate amounts we do recommend that you keep all receipts to verify that for each claim made meals were purchased.

On 6th April 2009 PayMatters applied for the new scale rate dispensation in relation to subsistence expenses: HMRC Subsistence Scale Rates and we have just recently had confirmation that the application was accepted.

For companies considering applying for the dispensation it is worth noting that while the original guidance said the only requirement to qualify for this dispensation was to complete and submit Form P11DX it appears that following discussion with the tax office it seems that their guidance manual means that all applications have to be accepted (and hence could be rejected).

The Guidance does however confirm that it is HMRC's aim to remove unneccesary paperwork and that companies should be encouraged to apply. It also recognises the fact that it is not always possible to obtain a receipt while buying food and drink. HMRC should therefore look favourably on all applications received.

For a full copy of the HMRC Guidance manual EIM05230 - Employment income: scale rate expenses: subsistence expenses: advisory benchmark scale rate payments please visit: EIM 05230

PayMatters are an Umbrella Company who help people working on temporary placements to be paid with the minimum hassle.

For further advice please call us on 0800 121 6513.