Your travel expenses are generally deductible where:
- You are responsible for paying the travel costs.
- The travel you are undertaking is necessary to your work i.e. your attendance at the place you are travelling to is mandatory.
The travel should not be ordinary commuting. HMRC defines a commute as the journey you make between your home and permanent workplace.
A permanent workplace is defined as somewhere you attend regularly in the performance of your duties, which forms a base to work from, or where you must attend to perform certain duties. For example, if you work in the same office, 9-5, Monday to Friday.
To be considered a valid business trip, the journey must be from one workplace to another, for the purpose of work.
Here are some exceptions:
If you have a home office that you regularly work from, this is generally your permanent workplace.
Any business-related journeys outside of your home, are considered journeys to a temporary place of work, and can therefore be claimed for. However, this is only possible for days when you work at home.
The 24 month rule
A workplace will not be regarded as temporary if the following applies:
- You have spent more than 40% of total working time there
- Worked there continuously over 24 months
- You intend to work at the site for more than 24 months
- You work there for all, or almost all, of the period for which you were an employee or director of your limited company at one workplace.
A workplace will be deemed permanent if the period you expect to work there exceeds 24 months and if you spend more than 40% of your working time there.
A workplace can be a geographical area but for different clients, please see HMRCs guidance on the matter.
If you do have a permanent workplace, please note that any travel, rent and subsistence expenses for that client would no longer be allowable as a business expense as the travel would be viewed as ordinary commuting.
The site becomes a permanent workplace from the moment that you show intent to remain there for more than 24 months. You can claim for any travel to the temporary workplace up until the point of forming this intention.