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Travel and Subsistence

If you work away from home, you could claim back any costs you incur which fall under the category of travel and subsistence. Find out more in our guide.

As the director of your own limited company, you’ll be familiar with the process of claiming expenses when working on an assignment that is outside IR35. If you work away from home, either frequently or occasionally, you could claim back any costs you incur which fall under the category of travel and subsistence.

What is subsistence?

Subsistence expenses refer to the reimbursement of any food costs associated with business travel. These expenses must relate to food purchased ‘on the go’ and it is closely tied in with travel therefore if you are unable to claim your travel expenses, you will be unable to claim your subsistence.

Claiming back costs incurred whilst travelling

Travel expenses are allowable as long as they are incurred whilst travelling to a temporary place of work. Unfortunately, you cannot claim back any expenses incurred during journeys between your home and permanent place of work, as this would be regarded as ordinary commuting costs.

If you begin commuting to a location which is not part of your ordinary commute, you could be eligible to claim back any expenses incurred whilst doing so.

If you are staying away from home because of work, you are also entitled to claim back a ‘flat rate’ allowance of £5 per night, or £10 if you are staying overseas. This allowance is designed to cover expenses such as laundry, which you would not typically incur if you were staying at your usual place of residence.

Personal vehicle and business travel

When using your personal vehicle for business purposes, the rate of mileage you are able to claim changes depending on the type of vehicle you own, and the number of miles you have already travelled during the current tax year.

To calculate how much you can claim, use the below figures:

  • Car: 45p per mile for the first 10,000 miles, 25p per mile after the first 10,000 miles
  • Motorbike: 24p per mile, regardless of how many miles travelled
  • Cycle: 20p per mile, regardless of how many miles travelled

What is a temporary workplace?

If the assignment or contract is going to last over 24 months and you are going to spend more than 40% of your working time at the location, the workplace will not be regarded as temporary. You cannot claim travel and subsistence expenses from the point you become aware that you will be working at a particular site for longer than 24 months.

The expense claim process

Claiming back your expenses is simple. Any travel and subsistence expenses claims must be reasonable, so any excessive purchases would be disallowed. As with all business expenses, you must also retain a receipt as proof that the transaction did take place.

How can Nixon Williams help?

When it comes to claiming back expenses, there’s a lot to get your head around. As a specialist contractor accountant, we’re able to provide you with all the information you need, whilst guiding you through the expense claim process.

If you would like to discover more, call our specialist team on 01253 843188.