This measure abolishes receipt checking by employers when they reimburse benchmark scale rate, overseas scale rates, or qualifying expenses incurred travelling to work, first announced at Autumn Budget 2017.

These regulations cover meal allowances for employers to pay or reimburse their employees for food and drink costs that would otherwise be tax deductible.

Draft legislation has now been released for comment in Clause 4, Finance Bill 2018-19.

It will affect employers who use benchmark scale rates (BSR) or overseas scale rates (OSR) when paying or reimbursing employees’ qualifying expenses incurred when travelling for work.

This measure removes the requirement for employers to check evidence, such as receipts, of the amounts spent when using BSR to pay or reimburse their employees’ qualifying subsistence expenses when travelling for work.

BSR are the maximum amounts an employer can pay or reimburse in respect of deductible subsistence expenses, free of tax and National Insurance contributions, without reporting the payments to HMRC under this system.

It also places the concessionary accommodation and subsistence OSR onto a statutory basis and, similarly, there will be no requirement for employers to check evidence of amounts spent.

Employers will only be asked to ensure that employees are undertaking qualifying business travel for both BSR and OSR.

Legislation will be introduced in Finance Bill 2018-19 to amend section 289A ITEPA by inserting a number of new subsections.

This measure does not change the monetary rates for BSR or OSR.

BSR cover modest meal allowances with which employers can reimburse their employees for food and drink costs, as follows:

The measure will come into force on 6 April 2019.

The closing date for comment on the draft legislation is 31 August 2018.

HMRC Policy paper: Abolition of receipt checking for benchmark scale rates and changes to overseas scale rates

Report by Sara White