An update on Travel for the self-employed.
It is essential to keep good, proper and correct records of all journeys made for the following reasons:-
If you are self employed, you may only claim tax relief on your travel expenses if your journey is undertaken wholly and exclusively for the purposes of your business.
It is dependent on the way that the self-employed person trades and where the business operates as to whether the journey qualifies for tax relief as business travel.
For example; Home to work travel may qualify as a business journey and the cost will qualify for tax relief where:
a) Home is the main or only workplace or the operating base of the business, or
b) The trade or profession is a travelling occupation, or
c) The nature of the trade is itinerant and the business base radiates around home.
Home to work travel is unlikely to qualify as a business journey when home is not a business base and the trader's business base is located elsewhere, such as an office, shop, unit or hospital.
It is generally assumed that a business base will tend to be where an individual performs their main working duties.
However, the rules are not straightforward and there is a substantial body of case law that sets precedents for particular occupations.
In recent years, HMRC have successfully challenged travel claims by members of the medical profession, a pilot and a flying instructor. Past cases have involved builders, barristers and a milkman.
Fare Pay & Books can assist with all your accounting, book keeping and payroll requirements.
Please don't hesitate to contact me.