HMRC has picked up on the fact that many self employed people claim home to work travel as a business expense rather than private and over the last 12 months I have seen queries raised on doctors, financial advisors, builders and solicitors to name only some.
The main considerations in determining the allow ability of home to work travel is as follows:
1. is the client an itinerant worker? In other words one that travels from their home to a number of different locations for a purely temporary purpose.
2. Does he have a regular, established itinerary?
3. Is the expense of travel incurred because of the nature of the work?
4. The location of the client’s home
In the case of one of my clients who was a Freelance TV presenter, who lived near Surrey. He travelled from his home to the studio four times a week, there and back every week. He claimed this travel expense in his last tax return. HMRC are arguing that the TV studio is his work base and that his travel should be disallowed.
Another example would be a self employed surgeon who travels each day from his home to either of two hospitals where he carries out operations. HMRC would argue the expense incurred from this travel would not be an allowable deduction.
At the end of the day each case is looked at individually and judged on its own merits and facts. It is vitally important, if you are self employed you are properly advised because HMRC are red hot on this area!
If you don't have a tax advisor get one!
Please contact me for further advice. mitch@ljd.uk.com
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