SE62665 - Tax treatment of engineering design employees: guidelines issued by the Federation of Engineering Design Companies - taxation of subsistence allowances

8. Subsistence allowances

Only where an employee incurs additional expenses through working temporarily away from home and his normal place of employment can such allowances be paid in full. What constitutes temporary absence follows the same rules as have been set out above, and the rate of allowance must be reasonable in all circumstances and not represent additional remuneration. Again, members are advised to seek an authority for an appropriate sum to be paid without deduction of tax from their local Inspector. Any payment in excess of the agreed figure would be subject to tax.