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taxadvisor.uk, Chartered Certified Accountant
Category: Tax
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Experience:  FCCA - over 35 years experience as a qualified accountant (UK based Practitioner)
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Hello I am working as an Airline Pilot for a UK agency, and

Resolved Question:

Hello I am working as an Airline Pilot for a UK agency, and i am resident in the UK. The contract consists of 5500 basic plus 2200 per diems. Are this 2200 free of tax or must there income tax be paid on Thx
Submitted: 2 years ago.
Category: Tax
Expert:  taxadvisor.uk replied 2 years ago.

Hello and welcome to the site. Thank you for your question.

There are conditions set by HMRC that have to be met in order for Per Diem allowance to be tax free. It is important that such arrangements are made with HMRC's approval, otherwise they would be considered as simply "Round Sum Allowance"and processed as additional salary and subject to PAYE tax and NIC.

More information on this topic can be found here

http://www.bkltax.co.uk/how-we-can-help/services-to-employers/per-diem-expense-allowances/

https://www.gov.uk/government/publications/scale-rate-expenses-payments-employee-travelling-outside-the-uk

https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/359797/2014_Worldwide_subsistence_rates.pdf


I hope this is helpful and answers your question.

If you have any other questions, please ask me before you rate my service – I’ll be happy to respond.


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Customer: replied 2 years ago.

Thx for your answer does that mean I can claim per diems as per the world wide persistence list? and hence change my existing Self declaration?

Expert:  taxadvisor.uk replied 2 years ago.
Franz, thanks for your reply.

Per Diems allowance per HMRC scale rates would be tax free.

I hope this is helpful and answers your question.

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