HMRC abandons ‘Travel & Subsistence’ proposals

Included within the Budget documents was the announcement that H M Treasury (HMT) and the Government had decided not to go ahead with proposals to change the tax system in respect of tax relief for Travel & Subsistence.

In the Discussion Document, issued at the end of September 2015, HMT had put forward a proposed framework of changes in conjunction with a list of underlying principles. However, in HMT’s response document issued a few days after the Budget, HMT explained that, although the responses to the Discussion Document supported the principles as set out in the proposed framework, there were difficulties in translating these principles to a workable set of rules. HMT no longer believes that the proposed framework provides enough simplicity to justify the upheaval for employees or the potential cost to the Exchequer.

The ATT was fairly critical of a number of the proposals in the Discussion Document, including the proposals dealing with Homeworkers. However, it does seem a shame that HMT appear to have given up at the first attempt in trying to reform certain areas, which we were in agreement did need improvement.

HMT have pledged to continue to look at other areas of Travel & Subsistence that are worthy of a review and where it feels it can achieve real progress but does appear to be focusing now on simplifying reporting requirements rather than tackling any fundamental changes.