EIM34180 | Foreign travel rules: P11D form and exemptions granted to employers

The expenses incurred by the employer should be shown on forms P11D unless covered by an exemption. Exemptions for travel expenses (unless covered by Sections 337 to 340 ITEPA 2003) can only be given in respect of named individuals. Employer's should consider Chapter 7 of booklet 490 when considering an application.

An employer can apply for an exemption if they want to apply for a bespoke or industry scale rate for reporting non-taxable expenses and benefits. You do not need to apply for an exemption if you’re paying HMRC’s benchmark rates for allowable expenses.

Where the exemption applies, PAYE does not apply to the payments or benefits concerned. The employer does not need to show the particular payments or benefits on the annual returns (forms P11D) they make to HMRC and the employee does not need to show them in their tax return.

You can only use bespoke rates for up to 5 years from the date they were last agreed.

The legislation covering exemptions can be found at s.289A to 289C ITEPA 2003. For more information about exemptions, please go to EIM30200.

Other points

• No exemption should be given for travelling expenses of the employee's family (see EIM34050).

• Any expenses that have been apportioned as being private should be excluded from the exemption.