Tax relief for travel expenses: temporary workers and overarching contracts
10 December 2008
This consultation seeks to expand and test the Government’s analysis of those structures using overarching employment contracts –umbrella companies and employment agencies- in terms of the size of the sector, their role within the wider labour market and the extent of the problems arising from the use of these structures.
Umbrella companies and some employment agencies make use of overarching employment contracts which enable some temporary workers to gain tax relief for travel expenses not available to others working in similar circumstances. There is also evidence of widespread abuse of the travel expenses rules by these structures. Non-compliance and the use of these structures to pay less income tax and national insurance contributions (NICs) lead to a loss to the Exchequer, as well as further problems.
The Government would welcome comments on its analysis of the sector and the labour market in which they operate, and on the problems identified. Comments on the possible actions to address the problem, including the effect they may have and any alternative approaches, would also be welcomed.
All comments should be received by 13 October 2008, and should be sent to:
Travel expenses consultation
Personal Tax Team
1 Horse Guards Road
Or e-mail firstname.lastname@example.org
The documents are available in Adobe Acrobat Portable Document Format (PDF). If you do not have Adobe Acrobat installed on your computer you can download the software free of charge from the Adobe website. For alternative ways to read PDF documents and further information on website accessibility visit the HM Treasury accessibility page.
Tax relief for travel expenses: temporary workers and overarching contracts (PDF file, 1.39MB) 21 July 2008
The Government thanks all those who participated in the consultation. In total 57 written responses were received (some written jointly) and 18 meetings were held.
The summary of consultation responses summarises what the Government has learnt through the consultation and sets out the Government’s policy approach, as informed by the responses received.
Tax relief for travel expenses: temporary workers and overarching employment contracts – a summary of responses (PDF file, 271KB) 10 December 2008
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