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Self Employed Travel Expenses

The miles you drive to reach each of your customers from your home base are used to calculate the amount of travel expenses you claim in your business accounts.

This is all good, but HMRC has recently argued in a tax case that where the business is based at the person’s home, that home-office can’t be treated as the starting point for travel when the work is performed almost entirely at customers’ properties.

HMRC has agreed that travel between customers is allowable, so you should be able to claim the majority of your travel expenses. However, travel from the home-office to say one client/customer and back home again is in question.

This doesn’t mean you should stop claiming the cost of travelling to customers, but to head-off any challenge in the future, you should record every business related journey;

-where it started,
-number of miles
-the reason for the journey, and
-who were you seeing.

Using an estimate of your total business mileage for the year is no longer an acceptable method of calculating your travel expenses.

You should also record what part of your business you conduct at your home-office, such as preparing estimates or writing reports…perhaps on the same spreadsheet you record your mileage details as above.