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'Stealth tax' on travel costs will hit agency nurses hard, says campaign

Trade group is pressing the government to rethink changes to travel and subsistence claims

Losing the right to claim costs for travel and meals during working hours against tax returns will mean agency nurses could find themselves around £90 a week worse off from next April.

Umbrella organisation for the recruitment industry RACS has revealed the figure as part of a wider campaign against government proposals.

Temporary contract staff, including agency nurses, are currently allowed to offset their work travel costs and meals against tax returns. But HM Revenue and Customs (HMRC) wants this to end, saying it is unfair to permanent employees.

Prism, a trade association for the temporary workers' market, has launched a campaign calling on the government to rethink its plans.

It said the current allowance exists because temporary workers do not receive benefits that permanent employees get, such as job security and pension contributions.

Nurses or care workers who visit several locations each day will still be able to claim for meals and travel between locations, though not for their first and last journeys of the day from and to home. 

But those hired from agencies to work in a single location – even if it changes on a daily basis – will not be able to claim for travel or meals.

A public consultation into the plans closed in September and the government is analysing the responses. The Department of Health did not comment but said it was not part of the consultation and has not done an impact assessment.

Prism said the changes are nothing more than a ‘stealth tax’ and that the loss to workers amounts to a real terms pay cut of £4,650 a year.

Prism chief executive Crawford Temple warned that temporary workers will simply charge more for their services in future to cover the lost expenses, which will cost more than the savings to HMRC.

He said: ‘Recruitment agencies are struggling to provide the numbers of nurses required to the NHS and these changes will make it even worse.

'Nurses are less likely to want to travel because they won't get their expenses back.’

A spokesperson for HMRC said: ‘These changes will make sure that all workers will be treated equally, whilst protecting the genuinely self-employed who will be unaffected.’

For more on Prism’s campaign see its website

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