ECH22105 - Settlement: Dispensations

Including expenses on forms P11D, where they could be covered by a dispensation can be

• a burden for the employer and
• a lot of extra work for HM Revenue & Customs in processing the forms.

Although expenses covered by a dispensation do not need to be returned on form P11D the employer should still maintain adequate records relating to the calculation and payment of those expenses.

Where a dispensation is in place

The ECO should

• fully review the dispensation
• ensure the employer's systems are adequate, for example, receipts are retained, claims are countersigned
• deal with any problems, and
• complete form ECR308

Where a dispensation is not in place

The ECO should

• consider whether one may be beneficial to the employer and in appropriate cases
• • encourage the employer to apply for a dispensation
  • give out leaflet IR69 and
  • refer the relevant details to the RAWT on form ECR308.

More information on Dispensations is contained at EIM30051 onwards.