10 year ILR and taxes

[gc1411]

I read on a separate thread (6 month short of 10 year lawful stay..Urgent advice needed!!) on this website that someone's ILR application was refused due to the following reason, that the original applicant

"does contracting jobs through Umbrella PAYE so there is a discrepancy between her earnings to UKVI and HMRC as she gets some expenses like mileage / subsistence as tax free allowance form her pay. Our application refused under 322(5) for Deception."

Could someone explain what was the issue here? I thought any subsistence etc received is not taxed?
Does this mean that if you work through an umbrella company and receive certain expenses, you have to count them towards your tax free allowance?

From UKVI perspective, what is the best thing to do with expenses received such as mileage, subsistence etc? Count them towards your income and pay tax on them?

To me, it seems like the best thing would be to not claim any allowance whatsoever and pay tax on everything you earn if claiming tax relief is going to cause issues with immigration.
Appreciate any advice, thank you all.

[Wanderer]

As of this year you can't claim any expenses via an Umbrella.

[gc1411]

As of this year you can't claim any expenses via an Umbrella.

Thanks Wanderer.