The primary aim of Cost of Living Allowance (COLA) is to ensure that UK Based Civilians (UKBCs) serving overseas maintain a standard of living broadly equivalent to that which they would enjoy in the UK. Put simply, it is a topping up a salary to meet the essential additional costs of living overseas and is, by virtue of its compensatory nature, granted tax-free status in accordance with section 299 of the Income Tax (Earnings and Pensions) Act 2003. 


Last Updated: Aug 12, 2020 @ 1:10 pm

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