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Tax and Funding Workshops Tax and Funding Workshops up next… Stephen Potter (Open University) Tax and Travel Plans Stephen Potter Professor of Transport Strategy [email protected] Transport and Tax • Unless a specific exemption 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 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) Edinburgh Royal Infirmary • 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.) 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. Works Buses • Employer-provided works buses with 9+ seats used for commuting –Occasional use for other trips (e.g. lunchtime shop runs) is OK 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 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) Carshare Backup Alternative backup ‘get-you-home’ transport for car sharers is tax-exempt (up to 60 trips a year) 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 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 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) 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. 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/cycletowork schemeimplementat5732 • Check with your local Inland Revenue Office Tax and Funding Workshops up next… Paul Curtis (LEPT) ACT Travelwise Conference The EC Supporting Sustainable Transport in Urban Environments Paul Curtis 14th November 2008 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 LEPT Coordination Implementation London European Partnership for Transport www.lept-eu.org Preparation Dissemination Public Sector Structure Local Government 33 London Boroughs TfL, GLA, LDA Regional Government London Councils Local Project Delivery Regional Policy Regional & Local Funding DfT National Government EC European Government London European Partnership for Transport www.lept-eu.org EPOMM Membership Funding Streams Thematic Areas Policy & Funding set by Mayor of London Energy Environment Freight Personal Travel Plans Public Transport Promotion Road Safety School Travel Smart Working Travel Awareness Travel Plans Walking Management Committee – Sub-regional Cycling London Boroughs TfL EU Networks EU Cities DfT LEPT UK Networks NGOs EU Institutions EC Funding Programmes London European Partnership for Transport www.lept-eu.org Steering Group – Borough Officers Car Sharing Outputs Arrange Events Attend Conferences Collect Best Practice Coordinate Boroughs Deliver Projects Disseminate Information Identify Project Partners Prepare EU Funding Bids Respond to Policy Staff Exchanges Study Tours European Commission European Commission - 31 Work Areas - €800bn Agriculture Employment & Social Affs Fraud Audiovisual Education, Training, Youth Humanitarian Aid Budget Enlargement Human Rights Competition Enterprise Information Society Consumers Environment Internal Market Culture External Relations Justice & Home Affairs Customs External Trade Public Health Development Fisheries Regional Policy Economic / Monetary Aff’s Food Safety Research & Innovation Foreign & Security Policy Taxation London European Partnership for Transport www.lept-eu.org European Commission European Commission - 31 Work Areas … and Transport and Energy London European Partnership for Transport www.lept-eu.org 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 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 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 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 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 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 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 Funding Programmes •CIVITAS - CATALIST - Transport & R&D Access Restrictions Less Car Intensive Lifestyle Clean Fuels and Vehicles Soft Measures Collective Passenger Transport Transport Management Integrated Pricing Strategies Urban Goods Transport • 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 Bidding Process Competitive Bidding Process 1. Develop project concept 2. Develop project consortium 3. Call for proposals 4. Consortium negotiations – WPs & budget 5. Political sign off, submit 6. EC Contract negotiations London European Partnership for Transport www.lept-eu.org 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 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 EU sustainable transport projects London European Partnership for Transport www.lept-eu.org LEPT Projects London European Partnership for Transport www.lept-eu.org 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 ASTUTE • Travel Plan Bromley Council • Improved facilities, information and publicity • After 1 year (started in 2007): o Increased walking from 9.5% to 12.5% o Increased cycling from 1.5% to 4% o Decreased car use from 69% to 61% London European Partnership for Transport www.lept-eu.org 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 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 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 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 IEE STEER – Trendy Travel Children guide parents • 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 Raising the image 5 Elements of Trendy Travel Pleasing the eye London European Partnership for Transport www.lept-eu.org Rituals provide structure Power of stories 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 Tax and Funding Workshops up next… Paul Henderson (LEPT) ACT TravelWise Annual Conference Birmingham 14th November 2008 Public Sector Structure Local Government 33 London Boroughs TfL, GLA, LDA Regional Government London Councils Local LA Project Delivery Consultation Regional Policy Regional and Regional Local Funding Devolved&Administrations DfT National Government EC European Government London European Partnership for Transport www.lept-eu.org DfT / NBTN EPOMM HA Membership / ACT TW COMMERCE Funding Streams 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 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 PAS500 ISO • Specification, not Standard • Can be advanced up the pyramid • Full consensus needed for British Standard European Standard British Standard Public Specification Private Standard Company Codes of Practice London European Partnership for Transport www.lept-eu.org Why A PAS? • Faster development process than a full consensus British Standard • Capture and share knowledge across the industry • Credible document as a result of BSI’s independence in facilitating the process of consensus building with the stakeholders • A PAS can be produced for product specifications, codes of practice, guidelines, vocabularies • A document that provides a benchmark for assessment • A PAS has the potential to be developed for promotion into the formal standards process at the national, EU or international level London European Partnership for Transport www.lept-eu.org BSI Process London European Partnership for Transport www.lept-eu.org Steering Group • ACT TravelWise • ACT TravelWise Scotland • Department for Transport (DfT) • National Business Travel Network (NBTN) • Highways Agency • Transport for London (TfL) • TravelWise Northern Ireland • Welsh Assembly Government London European Partnership for Transport www.lept-eu.org Stakeholder Consultation • Steering Group • ACT TravelWise membership • All LAs • LTT Article • ECOMM2008 • Various articles on websites: • IEMA, businessstandards.com, businessgreen.com, travelinedata.org.uk, planningresource.co.uk, parkingreview.co.uk London European Partnership for Transport www.lept-eu.org Scope PAS500 is for use of any organisation planning or developing WTPs and applies to all WTPs and all the situations in which WTPs are initiated, developed and implemented. This includes (but is not limited to) WTPs: • Initiated as part of an organisational policy to manage transport impacts for the benefit of staff, the environment, corporate social responsibility, the reduction of congestion, the better management of parking and to foster good relationships with neighbours; • Submitted with planning applications and/or transport assessments as part of the development control process; • Designed to reduce pollution from motor vehicles as part of an air quality strategy London European Partnership for Transport www.lept-eu.org Scope This PAS applies to all the main components of transport generated by a particular site. These include: • Commuter trips made by staff • Trips made by staff in undertaking their duties or otherwise in relation to their work • Visitors to the site e.g. patients and visitors to hospitals, clinics and other NHS facilities, local residents visiting council offices, suppliers or customers making trips to businesses • Contractors involved in carrying out projects at a particular site e.g. building and construction, 2 Terms and definitions catering and cleaning • Students travelling to university and college campuses and sites • Trips made by all those carrying out work related tasks at premises covered by the travel plan (e.g. servicing plant and equipment, delivering supplies) • Trips made by delivery vehicles of all types where the delivery is directly the result of demands made by the site to which the travel plan applies London European Partnership for Transport www.lept-eu.org Scope This PAS provides valuable requirements for organisations of all sizes but would be of particular use to workplaces or groups of organisations with more than 100 employees London European Partnership for Transport www.lept-eu.org Scope PAS500 does not cover: • The design of attractive walking and cycling facilities • Public or private bus, coach and train operations • The design and operation of public transport services • The detailed design and operation of car share and car club schemes • Specific detailed measures or interventions that are likely to succeed in reducing car trips • Setting specific targets, objectives or outcomes London European Partnership for Transport www.lept-eu.org WTP Process (all) • Senior management support • Defining aims and objectives • Measuring baseline travel behaviour • Defining the targets to be achieved and the associated timescales • Identify a range of interventions • Implementation strategy and budgetary resources • Periodic review WTP Process (DC) New sites will have to: • Establish preliminary modal split information (ref. best practice) • Provide trip generation data • Conduct a site audit • Commit to reducing SOV use and increasing sustainable alternatives • Identify a range of interventions • Integrate targets and aspirations into the recruitment process London European Partnership for Transport www.lept-eu.org Classification Grades - Bronze Must meet all above requirements and be publicly available (except commercially sensitive items) PLUS: • Have sufficient budget / resources allocated to achieve objectives • Be based on a survey, undertaken & analysed to identify travel behaviour of existing/proposed staff & visitors • Identify director/senior manager to have responsibility for travel plan strategy, implementation & progress • Include an implementation strategy giving clearly defined targets and milestones (min. 5 years) • Include marketing & communications strategy (min. five years) London European Partnership for Transport www.lept-eu.org Classification Grades - Silver Must meet all above requirements and Bronze requirements PLUS: • Survey details (questions, results, process of analysis) including how results will be used to achieve travel plan objectives • 1st year targets achieved OR • Review targets with full documentation and reasoning • Evidence of decreased SOV / increase in sustainable alternatives • Response rate of min. 30% of employees for travel survey • Evidence of communication of WTP measures / objectives to staff • Evidence of training for staff implementing WTP London European Partnership for Transport www.lept-eu.org Classification Grades - Gold Must meet all above requirements, including Bronze and Silver standards PLUS: • Be operational for at least 5 years • Survey undertaken and published at end of 5 years • Survey acheives min. 50% response rate • All targets must have been achieved, with supporting evidence • Good practice displayed in WTP has been actively disseminated (presentations, articles etc) London European Partnership for Transport www.lept-eu.org Supporting Information Appendices containing: • Glossary including components of effective TDM strategy • Publications, government guidance and best practice • Survey checklist • Survey methodology including trip generation databases • Sources of information and examples of target setting • Classification grades matrix London European Partnership for Transport www.lept-eu.org Accreditation • Accreditation body needed to administrate and accredit applications • Needs to be accredited by UKAS • ACT TravelWise developing business case to do this • Fee per application – profits reinvested in network • Established in early 2009 – Launch at spring conference? London European Partnership for Transport www.lept-eu.org Next Steps • PAS500 published 21st November • Publicity and Promotion of standard • Engagement of Planning Authorities • WTPs prepared to PAS500 specifications • Accreditation body set up by Spring 2008 ANY QUESTIONS? London European Partnership for Transport www.lept-eu.org Thank You Paul Henderson Head of European Projects [email protected] London European Partnership for Transport www.lept-eu.org Tax and Funding Workshops