Vol. 434 No. 2
138 Mr. N. Ahern asked the Minister for Finance if he will give details of the subsistence expenses granted by the Revenue Commissioners to employees visiting abroad; the origin of such guidelines; and if his attention has been drawn to the dissatisfaction of employees with these guidelines, to their reluctance to travel and, in some cases to their refusal to travel which has a detrimental effect on the overall economy.
I am not aware of any significant dissatisfaction in regard to the taxation of subsistence expenses. Strictly speaking expenses allowances are chargeable to tax under the ordinary rules of Schedule E and are liable to PAYE, PRSI and levies. However, Rule 3, Schedule 2 of the Income Tax Act, 1967, provides a measure of relief for individuals incurring expenditure wholly, exclusively and necessarily in the performance of the duties of their office or employment.
In order to avoid the need for deduction of PAYE and subsequent repayment claims in respect of expenses payments the Revenue Commissioners may, in certain circumstances, enter into an arrangement with an employer to allow such payments to be made tax-free to an employee. The scale of subsistence allowances agreed for the purposes of this arrangement must no more than reimburse the employee for the actual costs incurred. As a rule the rates of subsistence payable to civil servants are allowed in the absence of other agreed rates. These rates are generally in line with the costs to the individual of eating-living away from home. Where a Civil Service rate is not available for a particular country the United Kingdom Treasury rate for that country, which is calculated on the same basis, is used.
