Synopsis: In his 2014 Budget the Chancellor of the Exchequer announced that, in response to the recommendations of the Office of Tax Simplification (OTS), the Government would launch a review of the tax treatment of travel and subsistence expenses. The first stage of this review was formally launched on 31 July and is now fully underway.

Date posted: Thursday, September 04, 2014

In response to the Office of Tax Simplification’s (OTS) January 2014 report on the tax treatment of employee benefits and expenses, ‘Review of employee benefits and expenses: second report’, the government announced at Budget 2014 that it intended to review the rules underlying the taxation of travel and subsistence expenses.

The Government plans to conduct the consultation in stages, the first of which is now underway, with the second planned for winter/spring 2014/15. In the first stage, the Government will explore the circumstances in which employers pay travel and subsistence expenses and how tax and other factors influence these decisions; and discuss the framework within which it will develop any new principles. In particular the government wants to discuss what sort of payments should qualify for tax relief, who they should need to be paid by, to whom and in what manner – and whether tax relief for subsistence payments need be tied to the rules for travel.

The Government intends to make an initial update on the first stage of the review at the Autumn Statement 2014 and its findings will inform the production of a new set of principles upon which the rules of a new travel and subsistence tax regime will be based.

The review sits alongside the consultations on expenses and benefits and the broader call for evidence on remuneration launched on 18 June, both of which are intended to complement this work.


A new set of tax rules on travel and subsistence that are simpler to understand and use and which reflect 21st century working practices will be welcomed.


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