Back in April 2016, changes were introduced to the way in which individuals operating through an employment intermediary (a.k.a. an employment business or umbrella company) could claim tax relief on their commuter expenses.
WHAT ARE COMMUTER EXPENSES?
Commuter expenses are incurred whilst travelling from home to a permanent (as defined by the legislation) place of work. They also include expenses incurred as a result of the journey, e.g. subsistence or accommodation.
The legislation effectively removes the ‘temporary workplace’ label from individuals who work under the Supervision, Direction or Control (‘SDC’) of the engager (the client for whom you provide the work or service). These individuals cannot claim commuter expenses.
SO, WHAT IS ‘SUPERVISION, DIRECTION OR CONTROL’?
SUPERVISION includes having someone check up on work as it’s being done, overseeing it to a particular standard, and also providing the opportunity to develop skills and knowledge.
DIRECTION includes circumstances where work has to be carried out according to certain prescribed processes, and where there is limited freedom as to how work is done. In short, work has to be carried out in a certain way.
CONTROL: This is control over how time is spent at work, if someone instructs how work should be undertaken, or if/how a worker moves from one job to another.
WHAT DOES THIS MEAN FOR ME?
The solutions available to you will vary depending on which of the following describes the way in which you carry out your work:
- You are under ‘SDC’ and are a ‘Multi-Site Worker’*
- You are under ‘SDC’ and are not a ‘Multi-Site Worker’*
- You are not under ‘SDC’
*A ‘Multi-Site Worker’ is an individual who travels from location to location during their working day in order to carry out their role/perform their service.
CAN I CLAIM COMMUTER EXPENSES?
“I am under ‘SDC’ and I’m a ‘Multi-Site Worker’”
You can’t claim commuter expenses, but you can claim mileage for the journeys from appointment to appointment and accommodation & subsistence in conjunction with non-commuter journeys. You can’t claim for home to work travel, or vice versa. Receipts must be submitted for all claims, and Tax and NI relief is available.
“I am under ‘SDC’ and am not a ‘Multi-Site Worker’”
You will not be able to claim commuter expenses.
“I am not under ‘SDC’”
Here at Trafalgar, we have the Mileage Only solution, where you can claim weekly mileage, including foe your commute. We can also help you claim tax relief on any other allowable expenses incurred in the performance of your duties, however, they may only be claimed at the end of the tax year and receipts must be provided.
Why not get in touch with Trafalgar today to discuss the right route for you. Call us now on 020 7940 1990, and one of our dedicated advisors will be able to help you.