9th January 2011
Businesses hiring temporary workers can no longer include tax-free travel and subsistence expenses as part of their National Minimum Wage (NMW) contributions, under new legislation.
Under the National Minimum Wage reforms introduced on 1st January 2011, travelling and subsistence expenses eligible for tax relief will not count towards NMW pay. The change affects businesses that contract or employ temporary workers, and apply to expenses for travel from home to a temporary place of work, as well as associated subsistence and accommodation costs.
“For a number of years we have called on the Government to ensure clarity and consistency in the way that travel and subsistence schemes are interpreted by HM Revenue & Customs [HMRC] — particularly with regards to how such schemes interact with NMW regulations,”
said Lewina Farrell, head of professional services at the Recruitment & Employment Confederation.
“[Now that the amendments have been introduced] our priority is to continue working with members to ensure that the changes are understood and to co-operate with HMRC on the effective enforcement of the regulations.”
For further information on the reforms refer to the National Minimum Wage (Amendment) (No.2) Regulations 2010.