Employers pay employee congestion charge fees

More than a third of employers have decided to foot the bill for the London
congestion charge for employees who have to drive to work, according to
research.

More than 1,200 employers were polled by employment law specialists Fox
Williams into the effect of the congestion charge, which came into force
yesterday.

Anyone driving into central London now has to pay a £5 a day charge to the
Greater London Authority. The scheme is effective Monday to Friday between 7am
and 6.30pm.

Helen Monson, employment specialist at Fox Williams, said: "We were
surprised at the high proportion of employers who considered they would have to
foot the congestion charge bill for their employees.

"In the current market, they obviously feel it necessary to pay the
charge to ensure key employee retention. It may also be a consequence of the
currently unreliable state of the Tube, in particular the Central Line."

Monson said employers and staff need to be aware of the tax implications
arising from reimbursing employees for the congestion charge.

Such reimbursement will be regarded as a taxable benefit in the hands of
employees unless the charge is "wholly, exclusively and necessarily incurred"
as a part of their duties, which the Inland Revenue says does not include
commuting to work from home.

Monson also warned: "Employers who agree to pick up the cost of the
congestion charge need to make it clear that they are not going to pick up penalty
charges if the employee forgets to pay."

By Ben Willmott

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