Removal and relocation expenses

Your employee may have to move house in order to carry out their employment duties. You can repay your employee’s expenses for removal and relocation tax-free if it costs your employee money to:

  • move to a new employment location
  • take up their employment.

These expenses will be tax-free if:

  • there are actual removal and relocation expenses
  • the expenses are for a reasonable amount
  • the payment of the expenses is properly controlled
  • moving house is necessary.

Tax-free expenses

Only those expenses which are a direct result of the change of residence can be repaid tax-free. These include:

  • auctioneer's fees, solicitor's fees and stamp duty arising from moving house
  • removal of furniture and other items
  • storage charges
  • insurance of furniture and other items in transit or in storage
  • cleaning of stored furniture
  • travelling expenses on removal.


You may pay your employee subsistence expenses, tax-free, in certain circumstances.

You may pay a temporary subsistence allowance while your employee looks for accommodation in the new location. This payment is for a maximum of ten nights, at rates that do not exceed current Civil Service rates. This payment does not need to be vouched by receipts.

You may also pay rent for temporary accommodation for a period of not more than three months. This payment must be vouched by receipts. You can not pay this expense and temporary subsistence allowance at the same time.

Expenses which are not tax-free

The following expenses are not tax-free:

  • any part of the capital cost of buying or building a house
  • any bridging loan interest, or loans to finance your employee buying or building a house.

The amounts you may pay tax-free are restricted to actual costs incurred at the time of the move.

Disturbance money is treated as salary and should be taxed.

Records to be kept

All records relating to removal and relocation expenses paid by you should be kept for six years.