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Q. I am the sole director of a company, and my office is based at home. For historical reasons many of my clients are based in the South of England whereas I live in the North. This means that I spend most of the week on the road, staying in hotels, then returning to my home office on Fridays to undertake administrative work. What can I claim for subsistence? Am I only allowed the daily allowance of £5/£10 per day, or can I claim the actual cost of meals that are likely to cost more than the set allowances?
A: You can claim the full hotel costs and the costs of the meals because these expenses are deemed necessary for the performance of your employment duties. To learn more, see HMRC's Employment Income Manual at EIM31815.
Here, it states that 'travel expenses' for this purpose include the actual travel costs 'together with any subsistence expenditure and other associated costs that are incurred in making the journey. This includes:
- any necessary subsistence costs incurred in the course of the journey
- the cost of meals necessarily purchased whilst an employee is at a temporary workplace
- the cost of the accommodation and any necessary meals where an overnight stay is needed - this will be the case even where the employee stays away for some time'
HMRC gives examples at EIM31816 that mirror your situation (example 2).
Also see HMRC Guidance: Business Journeys Tax Relief.
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