Travel Expenses For Directors

Tax deductible travel rules for owners and directors of companies

What Counts as Business Travel?

You can usually claim travel and incidental costs when you:

• Travel between different workplaces

• Go to work appointments

• Engage in other business-related activities

We'll explain incidental costs at the end of this post. Our initial focus will be on what qualifies as business travel.

Commuting is not a Business Expense

You cannot claim tax relief for commuting costs, but there are two exceptions:

1. When you 'work' at a temporary workplace

2. When your home qualifies as a workplace

Don't try to game the system though - HMRC have extensive rules around permanent and temporary workplaces. We'll explain them in more detail next, but in most cases you'll intuitively know whether a workplace is permanent.

Temporary and Permanent Workplaces

What is a Permanent Workplace?

A 'permanent workplace' is where you:

• Spend at least at 40% of your working time

• You expect to work for at least 24 months

Any location where you spend all of your working time, even if it's less than 24 months - counts as a permanent workplace.

What is a Temporary Workplace?

Conversely, a temporary workplace is where you work for short durations or for less than 24 months.

But as mentioned above, if you work at one location - even if it's for less than 24 months - then it counts as a permanent workplace.

When Home Qualifies as a Workplace

Your home can qualify as a workplace if you:

• You conduct material fee-earning duties from home

• Your home is where the company’s registered office is based

If you only carry out basic admin at home, then it is unlikely to qualify as a workplace.

But if part of your contract has to be performed from home, such as providing out-of-hours support, then it might qualify.

And if home qualifies as a workplace then you may claim travel expenses between home and any another workplace - whether temporary or permanent.

Incidental Costs

Hotel costs, meals and drinks are all allowable business expenses when incurred during business travel.