Expenses and tax relating to travelling to work

Further to the detailed post about expenses for the self-employed, we often get asked about what the law on tax and earnings is for your travel to and from a place of work.

If you are employed by a company, they have a workplace that they expect you to travel to regularly, you generally won’t get paid for the time you spend travelling to work.

You will also find it very hard to treat your journey to work as either …

  • an expense that you can claim back as a tax-free expense from the employer (if you are a PAYE employee),
  • a cost that you can treat as a business cost that you deduct from your income when determining your self-employed profits (if you are self-employed).

If your employer asks you to travel to a place of work that is different to your normal one…

  • If you are a PAYE employee, then you can ask the employer to pay your travel costs as a tax-free expense (so the payment your employer makes won’t be treated as a wage) and they will usually have a standard expenses framework that they will use to pay this.
  • If you are a self-employed sole trader, any expenses you incur could be treated as a business expense and you can deduct it from your earnings before you calculate your taxable profits. It is up to you to negotiate with the employer about if they’re going to meet this cost or not though. We urge members to always agree on what their engagers’ approach to travel costs is before accepting an engagement.

If you have multiple, and overlapping engagers, you can often treat your home or a workshop that you use as your normal place of work. But if you are engaged to go to a workplace regularly, then that is the normal place of work and you can’t usually claim for that.

 

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