Many companies do not know how to justify per diems to the tax authorities. In this article we tell you what they are, what types exist and how to justify them correctly.
The diets are financial allowances that cover expenses incurred by the worker during their working day. These diets are included in the Worker's payroll. However, it is important to duly justify them to the Tax Agency, as otherwise, they constitute a normal part of the worker's salary as part of the payroll, which makes them subject to the corresponding taxation in each case.
The first thing to consider when knowing how to justify diet expenses to HM Revenue and Customs is to know which expenses can be justified and which cannot. In general terms, employee expenses are all those expenses linked to their work activity when it is carried out away from their usual place of work. This way, we will find, for example, expenses related to food, transport, and accommodation (as may happen during a business trip).
The most important aspects of each type of expense are the following:
In order to justify expenses incurred on public transport, the invoice or equivalent document must be retained. In this case, the exempt expense will be the full value of the document in question.
In this case, invoices or equivalent documents relating to tolls and parking must be kept, for which the exemption will be total. With regard to the cost of fuel, it will only be exempt from declaration to the Tax Agency. £0.19 per kilometre. The cost that exceeds this reference will have to be declared.
When an employee travels from their place of residence and stays overnight in a different city, the expenses exempt from tax for accommodation will be those that can be justified (by presenting an invoice or equivalent document). Meanwhile, the expenses incurred for meals (expenses in restaurants, cafés, etc.) will be a maximum of £53.34 per day (if within Spanish territory) and of 91.35€ daily (if it is in foreign territory). All expenses exceeding this figure will have to be declared.
On the other hand, even if the worker does not stay overnight in a different city but does travel to it for work purposes, the expenses incurred for maintenance can be justified. In this case, the expenses that can be justified will correspond to £26.67 diaries (if on Spanish territory) and to 48.08€ daily if it is on foreign territory.
Regarding how to justify diets to HM Revenue and Customs, several aspects need to be taken into account to determine whether they are justifiable or not.
Although living expenses can be justified to the tax authorities, there are other alternatives that make the process easier. Using Ticket Restaurant to finance the maintenance costs of the workers, greater comfort is gained, as the cost is equally exempt from tax payments and is a quick and easy way to carry out the payments in restaurants, cafés, and food shops. A convenient and effective way to save on paperwork and complications.
