If you work from home then the following may be very important to you. There has been an important development in the law concerning when travelling expenses can be claimed if you have an office at home.
After taking the case to appeal the Upper Tribunal has upheld the decision previously made by the Lower Tribunal in the case of Dr Samadian v HMRC. In this case, Dr Samadian had full-time employment with the NHS at two hospitals, as well as operating as a self-employed consultant at two private hospitals. Dr Samadian claimed the cost of journeys made between an NHS hospital and a private hospital and also the cost of journeys made between his home office and a private hospital. In both instances, the pattern of the journeys was regular.
The Upper Tribunal agreed with the decision of the Lower Tribunal that the cost of journeys between an NHS hospital and a private hospital were not deductible as they were not necessitated by Dr Samadian’s self employment. Crucially, they also agreed with the Lower Tribunal that the journeys between his home office and the private hospital were also not deductible as they served a dual purpose, ie they also allowed Dr Samadian to leave or return to his home.
The important fact here is the regularity of the travel and not the fact that Dr Samadian was a doctor. The same facts have been used to disallow the travelling expenses of a flying instructor who claimed the cost of travelling between his home office and two airports from which he gave his flying lessons.
It would appear , therefore, that whether or not the cost of a journey is wholly and exclusively for business purposes depends upon whether or not there is a “regular and predictable” pattern to the travel. For instance, if you operate from home and travel to different sites, and once the job is finished you move to a new site, then the cost of travel should be deductible. However, the cost of travelling to the same site of a regular basis appears to be no longer allowed against tax.
If you think that you may be affected by this ruling then please contact us.