January 07 ,2016 | by Erin O’Neill

Travel tax relief reforms warning from ATT

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The Association of Tax Technicians (ATT) has issued a warning about the impact of changes to the tax rules governing travel expenses, saying that those that work from home could be hardest hit.

Tax News reported that the ATT said the new proposals would deny homeworkers the opportunity to choose their home as their main base of operations if they also have a base elsewhere, for instance at their employer's head office.

Current system

The subtle difference could mean that homeworkers in this situation would not be able to claim tax relief for travel between their work place at home and the office.

Under the current system, relief for "travel in the performance of the duties of the employment" can include any journey that is taken between two workplaces. Only "ordinary commuting" is exempt from relief, meaning that those people who simply travel from home to one place of work can't claim expenses against tax.

New rules

However, the Government's new proposals will force employees who spend over 30% of their time working in more than one location to choose a location (base) as their main working one. They would then not be able to claim tax relief on travel costs incurred between home and "main base."

ATT President Michael Steed said: "It is unfair that homeworkers may not be allowed to nominate their home as their main base under the proposals. It could result in tax relief being denied on what is, in effect, legitimate business travel. This would leave either employers or employees out of pocket and could lead to some employees giving up their jobs." 

Erin O’Neill

Erin O’Neill is an LSBF News Writer who reports on small business, careers, technology and education news.

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