Travel: Tax Allowances
The question
To ask the Chancellor of the Exchequer, what assessment her Department has made of the adequacy of the overseas scale rates for employees travelling outside the UK and cost of living pressures.
Answered by Dan Tomlinson
Where employers reimburse allowable travel expenses, tax relief is available provided the expenses are wholly, exclusively and necessarily incurred for work purposes.
Ordinarily, employers must hold evidence of the employee’s actual expenditure. However, to reduce administrative burdens on employers, HMRC allows expenses for travel outside the UK to be reimbursed without evidence up to the levels contained within the Overseas Scale Rates.
Where the Overseas Scale rates do not cover the expense incurred by employees, employers can still reimburse and provide tax relief provided they have appropriate evidence.
The Government keeps all taxes under review as part of the policy‑making process.
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