Reimbursable expense tax for Foreign Visitors

Richard Downie, Associate Director

This note is to inform you that retroactive to January 28, 1998, the tax on reimbursable travel expenses for non-resident alien independent contractors will no longer be applied.

Prior to this date, a tax was levied on reimbursable expenses for alien independent contractors at a rate up to 30% unless a tax treaty with the visitor’s government and the US Government provided otherwise. Reimbursable expenses then were treated as income, unlike such expenses for US citizens or permanent residents. That is, in this case, a UF employee applying for and receiving reimbursement for expenses incurred on behalf of his or her employer could do so without that reimbursement being considered income and therefore no tax liability was imposed. The tax on foreign visitors, however, posed a major impediment to attracting them to participate in international conferences, symposia, workshops, etc. Now this factor has been removed, and anyone inviting colleagues from abroad will find the process much easier to facilitate.

You may recall that for some time we have been attempting to obtain clarification regarding the premise for the imposition of such a tax. This has taken a long time, and I want to extend my appreciation to John Kruczek and his staff for working so closely with us and for us to pursue the issue. The matter has now been resolved.

You should be aware, however, that honoraria are still taxable as income unless tax treaties with the visitor’s home country make other provisions. You should therefore continue to work with the appropriate personnel office when processing reimbursement requests. If you do have further questions on this subject, please contact Mr. Steven Sauls by phone at 392-1324, or by E-mail at sauls@nervm.nerdc.ufl.edu.

Thank you