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CIS travel and subsistence

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  • # 116959


I have a potential new client who is a sole trader and subcontracts as a tradesman around the country. He has recently worked mainly in London. He lives in Newcastle. At present he drives to London on a Sunday, works Monday to Friday and travels home on a friday afternoon. Whilst working in London he hires a van to get to jobs with his tools and sleeps every night in hotels. He gets his jobs from an office in London. He breakfasts at the hotel and has his evening meal there. He also eats out for lunch. He is asking me what he can claim that is tax deductible.


I have read HMRCs guidance and come to the conclusion that he cant claim any hotel stays or meals. However he can claim travel to London and back as well as van hire and fuel to and from jobs. Excluding travel back and forth to the hotel. 


Please can anyone let me know if I am correct as he seems to think he can claim all hotel stays. HMRC seem to indicate that if it is a regular occurance which it seems to be then it is not an expense he can claim back. I am not even sure that the travel to the London base is tax deductable to be honest.




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  • # 116973

Hi, could you let me know which guidence you have read that made you come to your conclusions?

The general rule is that expenses must be wholly and exclusively for the purposes of the trade, and that travel from home to the normal place of work is not allowed.

If he subcontracts as a tradesman around the country, he does not have a normal place of work. His work is of an itinary nature and travel expenses are allowable, and so would be the cost of the hotel and reasonable costs of overnight subsistance.

If he is seeking contracts in London because he wants to be there for a reason not connected to his trade there is a duality of purpose and the costs between London and Newcastle would not be deductible. Travel to the different sites from his London accommodation would still be allowable.

If he keeps on working in London, the London area will at some point become his normal place of work and from that point onwards he can deduct still deduct travel from his London accomodation to sites, but not for the hotel or travel to and from Newcastle. I have heard that it is possible to find the answer as to when a temporary workplace becomes a permanent workplace by looking at the legislation for the deductability of travel expenses for employees, because if anything the rules for deductability of expenses from employment income are more strict than they would be for trading income. If we do that, the London area will become his normal place of work when either he has worked there for 24 months, or when it becomes apparent that the period that he is going to be working in London is going to be 24 months or more.


I think we need to know more about this office that he gets his work from. For example if this is a contractor who has a client base in London and he is working exclusively for this contractor than maybe we should consider the London area his normal place of work.


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