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Tax and Funding Workshops

Tax and Funding Workshops. Tax and Funding Workshops. up next… Stephen Potter (Open University). Tax and Travel Plans. Stephen Potter Professor of Transport Strategy s.potter@open.ac.uk. Transport and Tax .

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Tax and Funding Workshops

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  1. Tax and Funding Workshops

  2. Tax and Funding Workshops up next… Stephen Potter (Open University)

  3. Tax and Travel Plans Stephen Potter Professor of Transport Strategy s.potter@open.ac.uk

  4. Transport and Tax • Unless a specificexemption is made, employer support to staff for commuting is treated as taxable ‘income in kind’ • NOTE: for non-employees - students, customers or visitors, Travel Plan benefits are not taxable • For business travel, payments are tax exempt unless limits are passed or a private benefit provided

  5. Commuting support and Travel Plans • Until 1999, employer-provided car parking was the only major exemption (worth at least £500 per annum) • From 1999 many Travel Plan measures have become exempt from Income Tax and National Insurance Contributions (NICs) • Tax is on marginal cost to employer (so bulk or negotiated discounts are tax free) • Small benefits usually treated as ‘trivial’ (e.g. prize draws for car sharers etc.) Edinburgh Royal Infirmary

  6. Loans and Salary Sacrifice Schemes • Interest-free loans to buy season tickets, a bicycle or anything legal • up to £5,000 in any tax year. • Salary Sacrifice can be used to purchase anything subject to a tax concession. Mainly used for bicycles (also bus tickets/passes) • The employee agrees a cut (‘sacrifice’) in their pre-tax salary made up for by a benefit by their employer. • This effectively cuts the cost by at least a third • Salary Sacrifice also used for pensions, childcare, healthcare etc. HR departments are getting keen on this method – saves employers’ NICs too.

  7. Works Buses • Employer-provided works buseswith 9+ seats used for commuting • Occasional use for other trips (e.g. lunchtime shop runs) is OK

  8.  Public Bus Services • The benefit to employees of employers paying operators to improve public bus services to your site(s) are tax free. • Contracts with bus operators can include discounted or free fares for staff. • But other ways to subsidise tickets are still taxable (e.g. giving away tickets) • So you must subsidise in the right way to be tax efficient • Some bus salary sacrifice schemes are not strictly legal

  9. Bicycle Exemptions • The provision of Bicycles and Bicycle Safety Equipment (e.g. helmets and lights) has been exempt from tax since 1999. • The provision of cyclists breakfasts are also exempt from tax • Bicycle maintenance, rescue services etc. ARE liable to tax (but hopefully not for long)

  10. Carshare Backup Alternative backup ‘get-you-home’ transport for car sharers is tax-exempt (up to 60 trips a year)

  11. Taxable Travel Plan Incentives • Payments to give up car parking rights (‘Cashout’) • Vanpools • Any other cash incentives • (prize draws seen as ‘trivial’) • Subsidies to train, tram or Tube fares - or bus fares where there is no contract with the operator • Flexible schemes (vouchers, points ‘Green Miles’) need to be carefully designed…. • They could be taxable on the whole package if they contain a mix of taxable and tax exempt measures

  12. Business Travel • Some travel plans include business travel • Mileage expenses for use of employee’s own vehicles, has a tax-free limit of: • 40p/mile car mileage rate • Additional 5p a mile for car passengers • 24p mile for motorcycles • 20p a mile cycle mileage rate • Few (20%) employers encourage car sharing for business by paying a passenger rate

  13. Travel Substitution • Provision of equipment to homework is tax free (even if there is incidental private use, because there is no additional cost to the employer associated with private use) • Any cash payments to incentivise homeworking and teleconferencing liable to tax (unless a ‘trivial’ prize draw etc)

  14. Overall…... • Tax is less of an issue for Travel Plans than it was a few years ago • Some key areas remain in the tax net • In some cases the tax position can be a bit hazy (Salary Sacrifice for bus fares is one) • Be careful with mixing tax liable and tax free measures in a package • There are opportunities to ‘green’ business travel, which can be tax and cost effective, but are little used.

  15. Advice and Guidance • Potter, Stephen (2008): Tax and Travel Plan Measures, National Business Travel Network Advisory Note 1 (download from: http://www.nbtn.org.uk/NBTN_ADVISORY_NOTE_1.pdf • HMRC: Expenses and Benefits: A Tax Guide. (download from: http://www.hmrc.gov.uk/guidance/480.pdf • DfT Cycle to Work Implementation Guidance is downloadable from: http://www.dft.gov.uk/pgr/sustainable/cycling/cycletoworkschemeimplementat5732 • Check with your local Inland Revenue Office

  16. Tax and Funding Workshops up next… Paul Curtis (LEPT)

  17. ACT Travelwise ConferenceThe EC Supporting Sustainable Transport in Urban Environments Paul Curtis14th November 2008

  18. Overview • LEPT • European Commission • Funding Programmes • Budgets • What actions they will fund • Bidding Process • Examples of EU sustainable transport projects London European Partnership for Transport www.lept-eu.org

  19. LEPT Coordination Preparation Implementation Dissemination London European Partnership for Transport www.lept-eu.org

  20. Public Sector Structure London European Partnership for Transport www.lept-eu.org

  21. Policy & Funding set by Mayor of London Management Committee – Sub-regional Steering Group – Borough Officers EC Funding Programmes London European Partnership for Transport www.lept-eu.org

  22. European Commission London European Partnership for Transport www.lept-eu.org

  23. European Commission London European Partnership for Transport www.lept-eu.org

  24. Levels of Project Funding • EU Budget 2007-13: €800bn • €4bn (£2.85bn) for Transport • €2.35bn (£1.65bn) for Energy • €1.89bn (£1.35bn) for Environment London European Partnership for Transport www.lept-eu.org

  25. Funding Programmes - budgets • Intelligent Energy Europe STEER-Energy (€1.5m) • INTERREG IVB - ERDF (€5m) • INTERREG IVC - ERDF (€3m) • LIFE+ - Environment (€15m) • FP7 - Sustainable Surface Transport - R&D (€4m) • CIVITAS - Catalist - Transport&R&D (€40k) London European Partnership for Transport www.lept-eu.org

  26. Funding Programmes • Intelligent Energy Europe STEER – Energy • Alternative fuels and clean vehicles • Raising awareness of availability • Promoting procurement of clean vehicles fleets • Energy Efficient Transport • - Increase modal share of walking and cycling • - Increase the take up of Travel Plans • - Freight consolidation & fuel-efficient fleets London European Partnership for Transport www.lept-eu.org

  27. Funding Programmes • INTERREG IVB - ERDF • Tackle common problem in geographical region EG: • Increase take up of Mobility Management in urban areas by developing and piloting models to ease congestion: • business engagement • multi sector partnerships • alleviating bottle necks around major transport generators • travel plans • measurable outputs – Co2 London European Partnership for Transport www.lept-eu.org

  28. Funding Programmes • INTERREG IVC - ERDF • Transfer of Best Practice to improve effectiveness of local policies: Energy and sustainable transport. • Travel Awareness • Work and School Travel Plans • Road Safety • Clean Vehicles • Policy and Integration London European Partnership for Transport www.lept-eu.org

  29. Funding Programmes LIFE+ - Environment Air: To achieve levels of air quality that reduce risks to human health and the environment. Urban environment: integrated environment strategies for urban areas Noise: To contribute to policy development and implementation on environmental noise. Climate-friendly: Policies and strategies London European Partnership for Transport www.lept-eu.org

  30. Funding Programmes • FP7 - Sustainable Surface Transport - R&D • Urban Freight delivery systems • - Promote Green procurement tenders for freight delivery • - Consolidation centres • New Transport Concepts – Intermodality • Behavioural change – analysis of approaches London European Partnership for Transport www.lept-eu.org

  31. Funding Programmes • CIVITAS - CATALIST - Transport&R&D • Maximise impact of CIVITAS activities: chose 1 scheme • Local authorities, PT operators • Emphasis on local public – private partnerships • Political commitment essential London European Partnership for Transport www.lept-eu.org

  32. Bidding Process • Competitive Bidding Process • Develop project concept • Develop project consortium • Call for proposals • Consortium negotiations – WPs & budget • Political sign off, submit • EC Contract negotiations London European Partnership for Transport www.lept-eu.org

  33. Bidding Process • Programme Requirements • No. Partners • CIVITAS 3-6 partners • Interreg IVC up to 18 partners • Type of partners • Local government, NGOs, Research institutions, New Member States London European Partnership for Transport www.lept-eu.org

  34. Method of Funding • Some R&D at 100% • IEE at 75% • INTERREG IVC at 75% • Most at 50% • Needs Match Funding • Staff Time Eligible • Staged Payments London European Partnership for Transport www.lept-eu.org

  35. EU sustainable transport projects London European Partnership for Transport www.lept-eu.org

  36. LEPT Projects London European Partnership for Transport www.lept-eu.org

  37. ASTUTE - Walking & Cycling 1. Safety & Security Concerns 2. Lack of Infrastructure & Support 3. Poor Public Perception & Lack of Awareness 4. Inadequate Urban Environment & Design 5. Accessibility & Health Issues 6. Congestion and Air Pollution 7. Lack of Public Sector Support 8. Lack of Education & Training 9. Lack of Private Sector Support 10. Inadequate Information London European Partnership for Transport www.lept-eu.org

  38. ASTUTE • Travel Plan Bromley Council • Improved facilities, information and publicity • After 1 year (started in 2007): • Increased walking from 9.5% to 12.5% • Increased cycling from 1.5% to 4% • Decreased car use from 69% to 61% London European Partnership for Transport www.lept-eu.org

  39. COMMERCE - WTPs • 6 EU Cities & EPOMM • European Platform on WTPs • Local Travel Plan Fora • Skill Share • Pan - European Awards • Pan - European Standards London European Partnership for Transport www.lept-eu.org

  40. PIMMS TRANSFER • 15 partners – 7 NMS • Mobility Management Study trips • Master classes • Pilot projects • Carbon Trading – personal / municipal • International school challenges – reduce car use • Hotel Travel Plans London European Partnership for Transport www.lept-eu.org

  41. CIVITAS • Ploiesti (RO) – CIVITAS SUCCESS • Creation of first real cycling (8km) and walking CLEAR ZONE (4.3km) routes in Ploiesti • Pedestrian consultation, planning • Strategic plan for walking • Improved accessibility of urban centre London European Partnership for Transport www.lept-eu.org

  42. TAPESTRY project • Research into effectiveness of Travel Awareness Campaigns: Seven Stages of Change Model • 1. Awareness of problem 2. Accepting responsibility • 3. Perception of alternatives 4. Evaluation of alternatives 5. Making a choice • 6. Experimental behaviour • 7. Habitual behaviour London European Partnership for Transport www.lept-eu.org

  43. IEE STEER – Trendy Travel • Cork (EI) • “Emotional” promotion of sustainable transport modes such as cycling and walking • Student theatre on buses, cycling gear fashion shows, quizzes in shop windows London European Partnership for Transport www.lept-eu.org

  44. Upcoming conferences • LEPT Annual Conference London – 4 December 2008 http://www.lept-eu.org/ • ASTUTE Final Conference London – 5 December 2008 http://www.astute-eu.org/ Paul Curtis www.lept-eu.org

  45. Tax and Funding Workshops up next… Paul Henderson (LEPT)

  46. ACT TravelWise Annual ConferenceBirmingham14th November 2008

  47. Public Sector Structure Local Project Delivery Regional Policy Regional & Local Funding EPOMM Membership Funding Streams LA Consultation Regional and Devolved Administrations DfT / NBTN HA / ACT TW COMMERCE London European Partnership for Transport www.lept-eu.org

  48. COMMERCE • 6 EU Cities & EPOMM • European Platform on WTPs • Pan-European Awards • Setting European standards for WTP • PAS500 – British specification on WTP • See www.commerce-eu.org London European Partnership for Transport www.lept-eu.org

  49. PAS500 • Project Managed by LEPT • Sponsored by TfL • Based on work by DfT & NBTN • Technical author Professor John Whitelegg • Produced by British Standards Institution London European Partnership for Transport www.lept-eu.org

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