If you are one of the many people in the UK who is working from home, you may wonder about the tax implications. HMRC has updated their guidance on when tax relief is available for travel expenses ...
If you are mostly working from home then tax relief may not be available on your commuting costs!
First and foremost, it's important to note that whether or not your home is considered a workplace does not impact the availability of tax relief for travel expenses. This means that even if you have a designated home office, you may still be eligible for tax relief on travel expenses.
However, the key factor in determining tax relief for travel expenses is whether or not the journey is considered to be in the performance of your duties as an employee!
If your home is your permanent workplace, then any travel from home to another location for work purposes will not be eligible for tax relief. This is because the choice to live in a certain location is a personal one, and any expenses incurred from travelling to and from your employer's premises are a consequence of that personal choice.
For example, if you are a sales consultant who is required to work from home four days a week and be in the office one day a week, you will not be entitled to tax relief on your travel costs to the office. However, if you are required to work from home as an objective requirement of your job, you may be eligible for tax relief on travel expenses to other workplaces.
It's important to note that HMRC will not consider working from home to be an objective requirement of the job if your employer provides appropriate facilities in another location that could be practically used by you, or if working from home is a matter of personal choice.
On the other hand, if you are required to work remotely one day a week while the rest of your working week must be in the office, you will be entitled to tax relief on your travel costs as you are travelling between two workplaces. This is because the journey is considered to be in the performance of your duties as an employee.
"Tax relief is allowed for travel expenses between your home and a temporary workplace!"
You will need to keep records of your journeys and this includes the date, destination, and purpose of the trip. You will also need to provide evidence of the expenses incurred, such as receipts or tickets.
It's important for employees to understand that the availability of tax relief depends on whether the journey is considered to be in the performance of their duties as an employee.
If you are unsure about your eligibility for tax relief, it's best to seek advice from a tax professional like me.
Until next time ...
HELEN BEAUMONT
Would you like to know more?
If anything I've written in this blog post resonates with you and you'd like to discover more about working from home, it may be a great idea to give me a call on 01908 774323 and let's see how I can help you.
Helen brings the personal tax planning experience of the top 20 tax companies to Essendon. Formerly of MacIntyre Hudson (with 45 offices nationwide), Helen worked at Chancery for more than 10 years before joining Essendon as the personal tax specialist.
Tax Planning can make a considerable difference to your tax liability. Helen has specialist knowledge and experience in tax planning and uses every opportunity to minimise your tax bill is utilised. By analysing your investments, income, profit and expenditures, Helen will provide strategic tax planning expertise that could offer significant savings, whilst delivering clear, honest advice and guidance.
When Helen is not at Essendon she spends time with her young son and likes going on long walks with the family dog.
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