Paragraph 2 Relocation expenses

United Kingdom

(1)

A payment of, or contribution towards, expenses reasonably incurred by a person in relation to a change of residence in connection with the commencement of, or an alteration in the duties of the person’s employment or the place where those duties are normally to be performed is disregarded if the conditions in sub-paragraphs (2) to (6) are met.

(2)

The first condition is that—

(a)

the payment or contribution—

F1(i)

is not, by virtue of section 271 of ITEPA 2003 (limited exemption of removal benefits and expenses) liable to income tax as general earnings under that Act; or

(ii)

would not have been so regarded, but is in fact disregarded F2by virtue of another provision of ITEPA 2003; F3...

(b)

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

(3)

The second condition is that the change of residence must result from—

(a)

the employee becoming employed by an employer;

(b)

an alteration of the duties of the employee’s employment (where his employer remains the same); or

(c)

an alteration of the place where the employee is normally to perform the duties of his employment (where both the employer and the duties which the employee is to perform remains the same).

(4)

The third condition is that the change of residence must be made wholly or mainly to allow the employee to have his residence within a reasonable daily travelling distance of—

(a)

the place where he performs, or is to perform, the duties of his employment (in a case falling within paragraph (3)(a);

(b)

the place where he performs, or is to perform, the duties of his employment (in a case falling within paragraph (3)(b); or

(c)

the new place where he performs, or is to perform, the duties of his employment (in a case falling within paragraph (3)(c).

References in this sub-paragraph and sub-paragraph (5) to the place where the employee performs, or is to perform, the duties of his employment are references to the place where he normally performs, or is normally to perform, the duties of the employment.

(5)

The fourth condition is that the employee’s former residence must not be within a reasonable daily travelling distance of the place where the employee performs or is to perform the duties of the employment.

F4(6)

. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .

F5(7)

For the purposes of this paragraph, Chapter 7 of Part 4 of ITEPA 2003 shall be read as if sections 272 (1)(b), 272 (3)(b), 274 and 287 were omitted

Annotations

Textual amendments

F1: Sch. 3 Pt. 8 para. 2(a)(i) substituted (6.4.2004) by The Social Security (Contributions, Categorisation of Earners and Intermediaries) (Amendment) Regulations 2004 (S.I. 2004/770), regs. 1(1), 28(6)(a)(i)
F2: Words in sch. 3 Pt. 8 para. 2(a)(ii) substituted (6.4.2004) by The Social Security (Contributions, Categorisation of Earners and Intermediaries) (Amendment) Regulations 2004 (S.I. 2004/770), regs. 1(1), 28(6)(a)(ii)
F3: Sch. 3 Pt. VIII para. 2(2)(b) and word omitted (6.4.2012) by virtue of The Social Security (Contributions) (Amendment No. 2) Regulations 2012 (S.I. 2012/817), regs. 1(1), 7(4)(a)
F4: Sch. 3 Pt. VIII para. 2(6) omitted (6.4.2012) by virtue of The Social Security (Contributions) (Amendment No. 2) Regulations 2012 (S.I. 2012/817), regs. 1(1), 7(4)(b)
F5: Sch. 3 Pt. 8 para. 2(7) substituted (6.4.2004) by The Social Security (Contributions, Categorisation of Earners and Intermediaries) (Amendment) Regulations 2004 (S.I. 2004/770), regs. 1(1), 28(6)(a)(iii)

Notes on the whole SI

Textual amendments

F1: See sections 3(2) and (5), 4(5) and (6), 116, 117, 118, 119 and 120 of the Social Security Contributions and Benefits Act 1992 (c. 4) (“the Act”) as amended respectively by paragraphs 3, 4, 22, 23, 24, 25 and 26 of Schedule 3 to the Social Security Contributions (Transfer of Functions, etc.) Act 1999 (c. 2) (“the Transfer Act”). The functions of the Department of Health and Social Services for Northern Ireland under the Social Security Contributions and Benefits (Northern Ireland) Act 1992 (c. 7) and the Social Security Administration (Northern Ireland) Act 1992 (c. 8) were transferred to the Department for Social Development by Article 8(b) of and Part II of Schedule 6 to the Departments (Transfer and Assignment of Functions) Order (Northern Ireland) 1999 (S.R. 1999 No. 481).
F2: See section 176(2)(b) of the Act.