Due to the rise of hybrid working, new challenges have arisen in the world of tax, especially regarding the claiming of relief for travel expenses. If you are a hybrid worker, you may be questioning whether you can seek tax relief for your travels from home to the office.

Understanding the Basics

It’s important to understand that the rules regarding travel expenses were established before hybrid working became widespread. As a result, they may not align perfectly with modern work arrangements. The main question is: When does a trip qualify as ‘business travel‘ (which can be claimed), and when is it simply ‘ordinary commuting’ (which cannot be claimed)?”

The Home as a Workplace

According to HMRC, working from home occasionally doesn’t automatically classify your home as a ‘workplace’. Taxman consider whether working from home is a requirement of your job, not just a personal choice.

HMRC’s Guidance: HMRC has updated its guidance (in Booklet 490) to help explain how the rules apply to hybrid workers. Here are some key points:

1. Even if your home is accepted as a workplace, you might only sometimes get tax relief for travel between home and another workplace.
2. Where you live is usually seen as your personal choice. So, the cost of travelling from home to any other place is seen as a result of that choice, not a job requirement.
3. HMRC might accept your home as a workplace if you need to perform important job duties there and you need special facilities that are only available at your home. However, this is quite rare for most hybrid workers.

Real-Life Examples

Let’s look at some examples to make it clearer:

Example 1: A sales consultant works from home four days a week and in the office one day a week. Even though the home is their workplace for four days, they can’t claim to travel to the office on the fifth day. It’s still seen as ordinary commuting.

Example 2: An employee works in the office four days a week but must work from home every Friday due to job requirements. On Fridays, if they need to go to the office, this travel can be claimed as it’s between two workplaces.

Example 3: An employee is offered flexible working and can choose to work from home or the office. Even if they work from home most of the time, travel to the office is still ordinary commuting because working from home is their choice, not a job requirement.

The Importance of Choice

The key factor here is choice. If you’re working from home because it’s your preference, rather than a strict job requirement, HMRC is unlikely to allow tax relief on your travel to the office.

What This Means for You

• Just because you work from home doesn’t automatically mean you can claim travel expenses to your office.
• For your home to be considered a workplace by HMRC, working from there needs to be an essential part of your job, not just convenient for you.
• If your employer gives you the choice of where to work, travel to the office is likely to be seen as ordinary commuting, even if you mostly work from home.
• Each situation is unique. Small differences in working arrangements can lead to different tax outcomes.

The world of work is changing rapidly, especially with hybrid working. However, tax rules for travel expenses haven’t quite caught up. If you’re unsure, consult our tax advisors or HMRC. Remember, just working from home doesn’t automatically make it a ‘workplace’ in the eyes of the taxman. Your home must be essential, not just convenient, for your work. As hybrid working evolves, rules may change, so understand how the current rules apply to your situation.