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Paying Employees travel expenses - tax liabilities??

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  • 01-04-2015 1:00pm
    #1
    kala85
    Registered Users Posts: 1,882 ✭✭✭


    I wish to find out about possible tax liabilities for an employer and employee in this situation.

    I am thinking of taking on an employee and I wish to pay them a basic rate of pay which would be taxable and then I was going to pay them travelling expenses at the civil service rate . The travelling expenses would be a reimbursement of their expenses in travelling to different locations?

    My idea is that the travel expenses would be free of tax and free of any tax liability?

    Would there be a tax liability here or could it be done?


Comments

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    #2
    frankythefish
    Closed Accounts Posts: 339 ✭✭frankythefish


    for employer, travel expenses would not come into the employee wages workings

    through employers p&l there will be nominal labelled travel expenses...


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    #3
    kala85
    Registered Users Posts: 1,882 ✭✭✭kala85


    Can the employer pay wages and travel expenses separately so?


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    #4
    frankythefish
    Closed Accounts Posts: 339 ✭✭frankythefish


    my boss pays me wages on a weekly basis(taxed), and travel expenses at end of every month(an allowable expense in his accounts)


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    #5
    Marcusm
    Registered Users Posts: 10,215 ✭✭✭✭Marcusm


    You can only pay round sum unvouched expenses with prior Revenue approval. This is the case even if you propose to adopt the Civil Service rates. You'll likely get the approval but if you do not seek it in advance, you run the risk of grossing up, interest and penalties. Revenue will need to be satisfied that you have appropriate controls and will maintain appropriate records.


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