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:
When you 'work' at a temporary workplace
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.
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