6 Remuneration Inclusion Percentage
This is an income value – a remuneration value is needed for PAYE calculation purposes.
To achieve this, the ‘80%/20%’ inclusion rate rules were added to the Fourth Schedule definition of remuneration from March 2010 to calculate the remuneration portion of the income value of the travel allowance.
In simple terms, 80% of the income value of a travel allowance is remuneration unless the employer is satisfied that at least 80 per cent of the travel for a year of assessment is business travel, then 20% of the income value of the travel allowance is remuneration.