Relocation Scheme Arrangements - Department Guide

The University operates a Relocation Scheme, under which individual departments have flexibility to award relocation allowances to new starters

Relocation Scheme process

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Departments have the discretion to offer a relocation allowance to new colleagues joining the University to cover the costs of moving house:

  • Relocation allowances paid via departmental funds (general ledger) may be offered at the department’s discretion.
  • Relocation allowances paid via external funding (e.g. research grant) should be in line with any relevant terms and conditions. If the funder will not support the full relocation allowance, the department may choose to use internal funds to support the new starter.

The following factors should be considered when deciding whether or not to offer a relocation allowance:

  • the need to recruit nationally or internationally to secure a suitable appointment (relocation allowances will not generally be paid where departments or division intend to recruit locally);
  • the difficulty of recruiting to a particular post; 
  • the importance of the post to the academic and business needs of the department;
  • the need to pay relocation costs in order to secure the appointment; 
  • affordability of the payment:
  • any other material factors. 

If it is known in advance that the department intends to pay a relocation allowance, this should normally be stated in the Additional Information section of the job description template, as follows: “Subject to HMRC regulations and the availability of funding, a relocation allowance may be available”.
 

Departments should understand the tax implications of the relocation allowance, and ensure that the new starter understands if they will have a tax liability. If the department intends to cover any tax liability, this should be factored into affordability considerations.

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The income tax threshold for relocation costs is £8,000. Departments therefore often use this as a cap, but can offer a different amount. 

  • In many cases, the costs of relocation will be below £8,000 and an appropriate allowance should be offered.
  • In exceptional circumstances, where recruitment imperatives apply, more than £8000 can be authorised by the Head of Department or Divisional Registrar. Tax will be due on the balance above £8,000 (the Head of Department or Divisional Registrar could authorise the department covering the tax cost).
  • If the allowance does not cover the full costs of moving, the individual would need to pay the excess themselves. Where costs significantly exceed the allowance available, the department may offer the facility of an interest free loan (see below).

To qualify for the tax free threshold, the following conditions must be met:

  • The new starter is moving from more than 25 miles away from Oxford to within 25 miles of Oxford (defined as the Bodleian Library, Broad Street, OX1 3BG).
  • The allowance must be spent by the end of the tax year (5 April) following the one in which the new appointment is taken up.  For example:
    • For an appointment starting on 3 February 2022, spend should be incurred by 5 April 2023. 
    • For an appointment starting on 6 April 2022, spend should be incurred by 5 April 2024.

Additional tax relief on travel costs is available to overseas appointees that are not UK-domiciled: further details are available on request.
 

If a new starter is not able to move within the defined timescale, they can request an extension from HMRC, explaining the reasons for the delay. Key reasons include a delay to allow a child to complete school exams, or difficulty selling their home within the usual time limit.

Correspondence should be addressed to: HMRC, Government Buildings, Ty Glas, Llanishen, Cardiff CF14 5FP, quoting their National Insurance number and the University's tax reference number of 075/Z1035.  

The University does not deduct tax when paying the relocation allowance; instead, and only where the £8,000 tax-free allowance is exceeded, details of relocation allowances are included on the annual P11D return. The individual should declare the benefit on their tax return.

If the department agrees to fund any tax incurred on the relocation allowance (if it exceeds the threshold or conditions are not met), the individual can claim the cost by notify the Head of Payroll & Pensions in writing, attaching a copy of the demand for tax from HMRC and written approval from the Head of Department or Divisional Registrar. The tax will be refunded via payroll.

For advice on tax implications, please contact the Head of Payroll and Pensions.

Additional guidance is available from HMRC.

Award of a relocation allowance should be approved in advance, and no reimbursement of expenses should be made until the department or division has approved the allowance, including details of the amount and any restrictions. 

The Authorisation for Relocation Allowance (xls) should be completed and approved by an appropriate Authorised Signatory. A copy should be provided to the new starter and a copy retained by the department.

Relocation allowances should be used to pay for: 

  • Removal of household effects (non-work related) - necessary costs associated with moving from a main residence only; 
  • Travelling expenses - a single journey from the place of previous residence to Oxford for the employee, any spouse or partner, and dependent children (see conditions paragraph); and
  • Professional expenses - professional fees in relation to the sale or purchase of a property.

The relocation scheme applies to personal effects only and does not cover the removal of office or laboratory items. Departments normally assist with the removal of such items, but should consider each case on an individual basis.

The relocation allowance is intended to cover the move of one household. This is generally considered to include the new starter’s spouse or partner and their unmarried dependent children under the age of 16 or in full-time education or other approved full-time training at the time of the applicant's appointment.
 

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The scheme includes:

  • One household move only;
  • A maximum of 26 weeks storage;
  • For overseas appointees, insurance for goods in transit to Oxford to a normal maximum value of £100,000 (specific approval must be sought for a higher sum). 

The scheme does not normally cover the cost of the following items however the department or division may decide to allow these costs at their discretion:

  • Separate removal of individual items
  • Removal of motor vehicles, livestock or pets
  • Import of personal wine/alcohol
  • In exceptional circumstances the University will pay for airline chargeable weight to be transported separately from the main household shipment. Any air freight costs will be deducted from the approved allowance.

Using the University's preferred supplier for removal

The University's preferred supplier, Robinsons will continue to assist with UK and international moves. Once an agreed allowance has been confirmed with the new employee, the new starter may choose to contact the preferred supplier if a removal quotation is required by the employee.

Email Robinsons: oxforduniversity@robinsonsrelo.com

The supplier will then contact the new starter and arrange a visual survey, after which their quotes will be emailed. Should the new starter accept one of these quotes, the supplier will request that an acceptance form is completed, to include the name of the authorised person within the department to whom the invoice should be sent.

Special arrangements are in place with the Finance Division Payments Team meaning it is not necessary to set up a PO. When submitting an invoice, please quote the relevant supplier reference code on the invoice along with the full string for the GL cost code or project code:

  • Robinsons – 2051904

New starters may decide to use a different removal company, but if this option is chosen, then it will be their responsibility to pay the removal company and seek reimbursement of these expenses through the usual expense claim process.
 

The scheme includes:

  • The cost of one single journey to the UK for the new starter and their dependent family;
  • If a return fare is cheaper and has therefore been purchased, a full refund will only be given if the return leg of the ticket is submitted unused with the claim. If the return ticket is not surrendered then only a 50% reimbursement can be claimed. In the case of e-tickets, a declaration must be made that the return journey will not be used;
  • In the UK, the cost of the initial journey for a single car can be covered at the normal mileage rate.

Additional tax relief is available to overseas apointees that are not UK-domiciled: further details are available on request.
 

The scheme includes:

  • Solicitors' fees in respect of sale and purchase
  • Stamp duty
  • Land Registry fees
  • Valuation fees
  • Registration fees
  • Search, survey and property enquiry fees
  • Conveyancing
  • Mortgage arrangement/redemption fees
  • Estate agents' buying/selling fees or advertising costs

The scheme does not include:

  • Redirection of mail
  • House cleaning on sale or purchase
  • Financial advice e.g. Mortgage Broker
  • Refundable deposits on rented accommodation
  • Engagement of professional cleaners before moving into a vacant rented property

Departments may choose to reimburse the following:

  • Letting agents’ administration fees including TRACC fee – (Tenancy agreement, References, Application, Check in and Checkout)
  • Professional cleaners when leaving a rental property where it is required under the contractual rental agreement.
     

 

Where it is not possible for the department to pay directly on their behalf the new starter should claim reimbursement for any costs they have incurred that need reimbursement via the expenses process.

When claiming these expenses, the expense type ‘Relocation’ should be selected.

New starters should be encouraged to contact their department prior to incurring any relocation expenses and no reimbursement of expenses should be made until the department or division has approved the appropriate authorisation form, stating the amount of the relocation allowance.
 

A new starter that can demonstrate that they have been financially disadvantaged, over and above the allowances available, by moving their home to Oxford, may apply for a long term loan up to a maximum of £10,000, repayable over a maximum 10 year period or the length of their contract if shorter. All such loans must be underwritten by departmental funds.

The appointing department should contact the Head of Payroll & Pensions for an application form. The Head of Payroll & Pensions will then arrange for the relevant loan agreement to be sent, the electronic bank transfer and the deductions set up on the individual’s payroll record. 

Repayment of the loan will be made via deduction from salary on a monthly basis. Please note that all existing University provided loans greater than £10,000 are regarded by HMRC as an employee benefit which will be declared to the tax office each year on a P11D and will be subject to income tax where applicable.

If the new starter resigns (or is dismissed) prior to the completion of three years' service, the department may request that they repay the proportion of the relocation allowance by which the period of actual employment falls short of three years.

Shortfall Calculation used: Total amount of expenses reimbursed, divided by 36 months, multiplied by the number of service months completed.

The shortfall is the difference between the total amount and the prorated amount.
E.g. relocation reimbursed £3000 and the number of completed service months equals 24 therefore £3000 – (£3000/ 36 x 24) = £1000 that could be reclaimed by the department/division.

If appropriate, any repayment due will be reclaimed via deductions from the remaining salary payment.

Please note this condition applies universally: applicants to the scheme who have an initial contract period of less than three years may also be requested to repay a proportion if they leave prior to the end of the three year period (i.e. in accordance with their initial contract term, or without extension to three years or beyond).

In exceptional cases the department may allow the repayment to be spread over a maximum period of 12 months after the individual has left the University. Permission to repay any significant amount in this way must be obtained in writing in advance of termination of employment.

Applicants for an interest free loan will be required to sign a separate declaration in respect of the loan.

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      University of Oxford
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