Lodging Allowance, taxable?

[KC75]

My employees are paid a £35 per night lodging allowance (their hotel is also paid for) when they work away.

I've always treated this as part of their normal pay, so tax & ni are deducted etc.

However, they are insisting that it should be a tax free payment & have pointed me in the direction of this hmrc article: https://www.gov.uk/hmrc-internal-manuals/employment-income-manual/eim71307

I can't find a link to the application form mentioned in this article & i'm getting the impression it only applies if you part of a union/working rule agreement, which none of us are.

Can anyone help me with this?

[bd6759]

You need to read the whole chapter starting at EIM71300

https://www.gov.uk/hmrc-internal-manuals/employment-income-manual/eim71300