Travel expenses incurred for business purposes by an employee are treated as deductible, subject to certain conditions. This document discusses these in detail, together with the situations in which travel expenses may or may not be deductible; issues with excessive reimbursements by an employer; travel expenses of workers supplied through intermediaries; and salary sacrifice arrangements.

Travel expenses have specific tests which must be satisfied in order for an employee to gain a deduction. These rules are different from the general rule for deductibility of expenses in that they do not need to be incurred 'wholly and exclusively'. This is because with any business travel, there are likely to be elements of mixed or private purpose, eg meals taken on a trip or overnight accommodation because the employee needs sleep. Meals and overnight accommodation come under the heading 'subsistence' and expenses on subsistence follow the rules on business travel. See the Subsistence expenses guidance note for more in-formation. ITEPA 2003, ss 337-339

As a result of the exemption for expenses that are either business expenses or the reimbursement of HMRC approved amounts, it is incumbent on an employer to keep the necessary processes, systems and controls to ensure that business and non business expenses can be correctly identified and recorded. ITEPA 2003, s 289A

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