Business Travel Expense Claims

9th Dec 2010

In recent months HM Revenue & Customs have targeted the motor expense claims of self employed hospital consultants. They have focused in particular on the mileage originating from their homes and between NHS and private hospitals.

 
When conducting an enquiry HM Revenue & Customs may ask you for a detailed list of journeys made each week. The list will need to include the mileage as well as the purpose of each trip.
 
HM Revenue Customs’ view is that the first and last journey of each day will be classed as private in nature and would therefore be disallowed. In addition, trips which could be considered to have a business and private element (e.g. trips to the bank) may also be disallowed. HM Revenue & Customs is reluctant to accept a consultant’s home as a “base of operations”.
 
The longstanding case on this matter related to a barrister who had a study at home and did a significant amount of preparation work at home. It was still held that any journeys from home to Chambers were private in nature and were therefore not allowable for tax purposes.
 
Unfortunately, a recent doctor’s case was settled ‘out of court’ before the tribunal hearing and therefore we have not received the more detailed and up to date guidance for which we had hoped. However, we do know that HM Revenue & Customs is looking for a test case to take to tribunal and also making more routine enquiries into travel expense claims.
 
In the meantime we therefore strongly recommend that you keep detailed logs of journeys undertaken so that a robust challenge may be made of any HM Revenue & Customs enquiries into your travelling expenditure.

Author: Emma Glover (emma.glover@rowlandsaccountants.co.uk)

« Back to Article List