Relocation expenses

How much can be claimed?

Up to 1/12 of initial starting salary (i.e. one month's salary).

For clinical staff, this does not include any availability supplements, allowances for additional extra programmed activities, distinction awards etc.

If your contract is for less than 2 years, relocation expenses will be reimbursed at a rate of 1/24th for each month of the contract. For example, if you have a 6 month contract - you will be entitled to 6/24th of one month's salary, 12 months - you will be entitled to 12/24th of one month's salary, 18 months - you will be entitled to 18/24th of one month's salary etc. If your contract is subsequently extended or if you remain employed at the University on another contract, you may be able to claim additional expenses, up to a maximum of 1/12 of initial starting salary (as stated above). In these circumstances you should contact the Finance Office.

Staff who are moving from outside the UK may be able to claim additional help towards travel costs.

The University wants to be reasonable about the expenses which you may claim and, except for the shipment of larger items such as a boat or a car, it does not specifically preclude any personal effects expenses.

You should be aware that any relocation expenses paid to you will be a taxable benefit (i.e. tax will be deducted before settlement) unless certain conditions are met.

The University tends to only reimburse expenditure which is also eligible for tax exemption. However each application for expenses is considered on its merits and in exceptional circumstances the University may meet non-exempt expenditure (but you will have to pay the relevant tax and National Insurance Contributions.)

Claiming for relocation expenses

The University will reimburse you for eligible expenses up to the approval limit on submission of appropriate receipts. There is no specific claim form: a covering memo with attached receipts is sufficient.

Claims should be sent to:

Lynsey Fraser
Payroll Office
University of Dundee
Nethergate
Dundee
DD1 4HN

When claims have been processed, the payment will be made by BACS transfer to the same bank account that your salary is paid into and an electronic remittance advice will be sent to your University email address.

Please ensure that the claim is completed within the HMRC time limits as otherwise, the payment may be subject to Tax and NIC rules applicable at the time of payment.

Is this payment taxable?

Any payments you receive towards relocation are treated as part of your earnings for tax and NIC (National Insurance Contributions) purposes. However, the first 8,000 of any help you get from your employer is exempt from tax and NIC's as long as certain conditions are met.

You can qualify for the exemption if:

• you have to move home to;
  • take up a new job with the University of Dundee.
  • continue your current job but in a new location;
• your existing home is not within reasonable daily travelling distance of your new workplace;
• the home you move to is within reasonable daily travelling distance of your new workplace;
• your expenses are reimbursed by your employer;
• claims are made within the Revenue's time-limit.

What is included in the exemption?

Most expenses connected with buying and selling a home, moving possessions and making preliminary visits to Dundee in connection with your move qualify for the exemption.

Do I have to dispose of my existing home?

No, but the home you move to must become your main residence.

If, for example, you stay in your new home only during the week, return to your existing family home most weekends and your family do not intend to move permanently to your new home, then your old home will probably remain your main residence. In that case, you would not be entitled to the relocation exemption.

But, if you buy a new home, move into it with your family and rent out your old home, your new home will probably become your main residence. If it does, you will qualify for the exemption.

What is the time limit?

To get tax relief your expenses must be incurred, or the benefits provided, before the end of the tax year following the one in which you started your new job (a tax year runs from 6 April one year to 5 April the next). The date you move home does not matter so long as the move satisfies the conditions set out above.

So, if you start a new job

• on 1st April 2017, you have until 5th April 2018 to use your exemption.
• on 1st October 2017, you have until 5th April 2019 to use your exemption.

If you were on a contract which is under two years then the time-limit will be activated once you have become eligible to claim expenses.

There is no time limit for NIC's (National Insurance Contributions).

Which expenses and benefits may qualify for exemption?

Expenses and benefits that may qualify for relocation reimbursement include:-

• cost of disposing of your existing home, whether you own it or rent it (or of a proposed disposal which falls through) such as:-
  • legal fees and services
  • estate agent's and auctioneer's fees and services
  • advertising
  • disconnecting gas, electricity, water and telephone supplies rent, insurance
  • maintenance and security once the property is left empty and before you sell it
• costs of acquiring a new home (or of a proposed acquisition which falls through for reasons outside your control, or where you have good reason to pull out) including:-
  • legal fees and services
  • loan arrangement costs and mortgage indemnity premiums
  • structural surveys and valuations
  • Stamp Duty and Land Registry fees
  • fees payable to the Keeper of the Registers of Scotland
  • connection fees for gas, electricity, water and telephone supplies
• costs of moving household furniture and effects (including ordinary gardening equipment) e.g.:-
  • packing and unpacking
  • temporary storage, if you do not move directly from the old residence to the new
  • insurance specially taken out to cover goods in transit or in temporary storage
  • removing and refitting domestic goods
  • moving ordinary domestic pets
• travel and subsistence cost for:-
  • family visits to the new location
  • family travel when the actual house move takes place
  • your travel and accommodation, if you have to commute (daily, weekly etc) temporarily to your new place of work (if you move to your new home after you move your job)
• temporary accommodation provided for you at your new location if you leave your old home before you can occupy your new home

Which expenses and benefits cannot qualify for exemption?

There are some payments, good or services, which can never qualify for exemption and which are subject to tax and NIC's (National Insurance Contributions) in full. The University will not normally consider reimbursement of this expenditure.

These are:

• mortgage or housing subsidies if you move to a higher cost area
• interest payments for the mortgage on your existing home
• re-direction of mail
• council tax bills
• the purchase of uniforms for your children's new school
• compensation or losses, such as:-
  • having to give up a partially used season ticket
  • a penalty for giving insufficient notice of a child's withdrawal from school
  • the cost of joining a new sports or social club
• compensation paid to you for any loss on the sale of your home
• payment of visas

Do I ever have to pay relocation expenses back to the University?

If you leave your post within two years then you will be required to pay back any relocation expenses which have been paid to you. Recovery will be at the rate of 1/24th for each month less than 2 years worked and will be automatically deducted from your final salary payment.