Manipay Limited v The Commissioners for HMRC
Decision date: 21 December 2022
Neutral citation: [2023] UKFTT 16 (TC)
Overall AI summary confidence: high
Short overview
This short overview is intended to summarise the case, issues and outcome so far as they are supported by the judgment.
AI confidence in this short overview: high
This appeal concerned whether Mainpay Ltd’s subsistence reimbursements to temporary workers were deductible for PAYE/NIC purposes and whether HMRC’s late assessments were time-barred. The Tribunal found the 2010 contract created separate employments for each assignment and, under s 339(5) ITEPA, the workplaces were permanent so subsistence was non-deductible as ordinary commuting. The Tribunal also held Mainpay could not rely on round‑sum/benchmark rates without an ITEPA dispensation or evidence of actual expense, and that HMRC’s late determinations were within time because Mainpay acted carelessly; the appeal was dismissed.
Ratio decidendi
This summary is intended to identify the ratio decidendi, meaning the legal reasons for deciding and the binding part of the decision.
AI confidence in this ratio decidendi summary: high
Where separate contracts govern individual assignments, each assignment can constitute a separate "employment" for ITEPA purposes, and if attendance occupies the whole or almost the whole of that employment the workplace is a "permanent workplace" under s 339(5), bringing it within the ordinary commuting exclusion (s 338). Absent an ITEPA dispensation, an employer cannot automatically treat round‑sum or benchmark subsistence reimbursements as tax-free without demonstrating employees actually incurred the expenses and having adequate procedures to support that.
Obiter dicta
This summary is intended to identify obiter dicta, meaning observations made by the way that were not necessary to deciding the case and are not binding.
AI confidence in this obiter dicta summary: medium
The judgment commented, without forming a binding rule, that if the relationship had been an agency contract rather than an employment contract, ss 44–45 ITEPA might produce a single deemed employment covering assignments and intervening gaps; and that HMRC may exercise administrative pragmatism in monitoring benchmark rate use and can revoke dispensations retrospectively.