Clients often get confused as to which work travel expenses may be allowable or not. The following article is going to highlight the common items that I often have to clarify with clients. You may be reading this from various perspectives, as an employee, a sole trader or an owner/director of a limited company, I will try to cover some of the different aspects of travel expenses that may be relevant to you.
Table Of Contents
Place of work
How much you can claim is up to your employer, as it is up to the business’s travel policy as to what they will reimburse you for. Currently the basic mileage allowance is 45p per mile, however, some companies may have a policy where they only reimburse a smaller amount e.g. 25p per mile and rarely some businesses may reimburse at a higher rate. If they reimburse at a higher amount you will be subject to a benefit in kind tax, and the excess will appear on your P11D.
Temporary Work Place
Travel Expenses Example 1
As the contract is clearly under 24 months he is able to claim for his journey costs and potentially subsistence costs.
Detailed guidance for temporary work place is in the HMRC guidance EIM32080. There are also some exceptions if you are considered to be an agency worker.
Travel Expenses Example 2
On these days he can claim the £5 breakfast subsistence allowance.
Travel Expenses Example 3
In this instance he can claim the two meal rate of £10 as he is working at least ten hours. However, if he kept receipts for the meals he purchased, he may find he is better off claiming for the actual cost.
For more details of benchmark subsistence rates go to http://www.hmrc.gov.uk/briefs/income-tax/brief2409.htm
If you are a sole trader you cannot in general claim these, the exception is you are away from home overnight when you may be able to claim a reasonable dinner and breakfast.
- Train fares
- Hotel accommodation
- Public transport
- Alcohol, unless in moderation with a meal
- Babysitter costs
- Christmas/Office decorations
- General groceries
- Kennel fees
- Personal charges on hotel bills e.g. in room videos
- Toiletry items
It is essential that if you aren’t sure about the treatment of an travel expense item that you request clarification from your accountant.