Getting Paid Exspenses Away From Home

[rickylester]

Hi can anyone help me please i am new to the forum and i have searched but no answers came back.
My question is my mate gets paid £50 a day tax free dig money but he goes home every night and never stays away from home.

1/ Is there a reason why his company would be doing this ie, keeping his basic salary lower.

2/ Is my mate going to have to pay anything back if the tax office found out that he was being paid this tax free but not actually staying away from home any advice would be much appreciated thanks.

[mullet]

1. Probably to keep the employee(s) sweet through paying less tax/NICs, and also paying less employer's NICs.
2. Assuming that the employer knows that no overnight costs are being incurred (i.e. that your mate isn't fiddling), then this is simply extra pay and it is the employer's responsibility to operate PAYE and account for income tax and NICs. But if the employee completes a self assessment return, then in strictness he should be declaring these amounts.

[rickylester]

Thanks for the reply the firm know he is not living away from home as they also do this for other employees.It just seems like it is some type of tax fiddle to me.