Tim Palmer looks at the considerable difficulties, problems and issues when a self-employed individual claims tax relief for their travel expenditure.
To calculate the taxable profits for a self-employed individual, the expense must have been incurred ‘wholly and exclusively’ for the purposes of the trade or profession.
Base of operations
The area of self-employed travel can be a thorny issue. Where a self-employed individual has a base of operations which is different and separate from their home, the cost of travel between their home and that base will not be an allowable expense. It is ‘ordinary commuting’.
If a person’s base of operations is their home, then depending on the particular facts and circumstances, the cost of travel between home and the place where the work is carried out should be a deductible business expense.;
