Travel Expenses Tax Relief Guide

Employed and use your own vehicle or public transport for journeys other than normal commuting?

You can potentially claim tax relief on business travel costs between temporary work locations, but not for your regular commute between home and your permanent workplace.

Tax relief can also be claimed for parking fees, tolls, and subsistence costs during business travel.

To be successful your travel tax relief claim must:

• Meet the conditions set out by HMRC employment expenses rules.
• Have appropriate evidence.
• Confirm that you are not reimbursed in full by your employer for your travel costs.

To avoid a claim rejection understanding exactly what you are entitled to and the evidence needed to support your case, is important.

This guide to tax relief for travel will walk you through what you need to know about checking if you’re owed tax, the various claiming methods available, and how long you can expect to wait for your refund.

What journeys can I claim travelling expenses for?

You can only make travel expense claims for journeys to a temporary workplace (not commuting to your normal place of work).

In general, if you have to go to a temporary place of work for less than 24 months, you should be eligible to claim back travel expenses.

What’s more, as part of your travel expenses claim you can also claim tax relief on:

• Accommodation costs when you stay away from home.
• Subsistence for food and refreshment costs.
• Car parking and toll charges.
• Tools bought for work and uniform washing.

How much tax back can I claim for travel?

How much you may be owed depends on a few factors including how much you have spent, how much tax you have paid and if your employer has reimbursed you.

Tax relief will be applied to your allowable travel expenses at the highest rate you pay tax which will typically be 20% for basic rate, 40% for higher rate or 45% for additional rate taxpayers.

If you have used your own car you can use our free mileage relief calculator to help you work out what you might be due.

What you’ll need to claim for travel expenses

You need to have some records to back up your claim. This could be:

• Details of journeys made such as a diary of locations visited and dates.
• Pay slips that show business mileage or lodging costs paid by your employer.
• Receipts for accommodation subsistence and other travel expenses are also helpful.
• Your contract of employment or a statement from your employer confirming your job title and the temporary nature of your travel.

Keep these documents organised by tax year, as HMRC allows claims going back four tax years.

Having this information readily available makes the checking process significantly more straightforward and ensures you don’t overlook potential refund opportunities.

What if I don’t have any travel expenses records?

A claim can still be without records in very specific circumstances. HMRC will normally always want to see actual records for your travel claim.

If you submit a claim that is not evidenced with insufficient records HMRC will ask for more information at which point you can explain to them your situation and HMRC can then make a decision on your claim.

What if my employer has paid me some travelling expenses?

You might still be eligible to make a claim for travel expenses if:

• The allowance doesn’t cover your full costs.
• The allowance paid by your employer is taxed.
• You use your own car and your mileage allowance is less than the government approved rates.

Claiming for previous tax years

You can reclaim overpaid tax going back up to four years – a fact many taxpayers overlook. For claims outside the self-assessment system (such as employment expenses), HMRC typically issues refunds by cheque for previous years or a bank transfer.

How to claim your travel tax relief

To file a travel claim with HMRC, you must submit either an online iForm, a P87 form, or a self-assessment tax return.

The online Government Gateway generally offers the quickest route to receiving your refund. Those claiming through paper methods should prepare for longer waiting periods.

• Online claims: HMRC’s online iForm can be accessed here, and it requires you to sign into your government gateway account before proceeding with the submission process.

This online method is designed to streamline the claims process, making it easier for individuals to manage their claims efficiently.

• Postal claims: The P87 form is appropriate for tool tax relief claims that are under £2,500 and is particularly suitable if you do not file a tax return for any other purpose, such as property rental income.

When submitting a P87, HMRC typically requires your travel records to validate your claim. It is advisable to retain copies of any receipts that you post to HMRC, as this can help in case of any discrepancies or inquiries regarding your claim.

• Self-assessment: For tool claims that exceed £2,500 in a single tax year, filing a self-assessment tax return is generally required. To initiate this process, HMRC will establish a self-assessment account for you once you have completed an SA1 form.

This account will enable you to submit tax returns with your tool expenses clearly listed in the employment section, ensuring that all relevant information is accurately reported.