HMRC are consulting on a number of extra statutory concessions. These are concessions made by HMRC and technically have no legal basis. However legislation is being introduced to rectify this problem.

One such concession related to the self employed and subsistence claims whilst travelling. Generally HMRC were extremely reluctant to allow claims on the basis that an individual needed to eat to survive not to work.

However the proposed legislation will now ensure that subsistence will be allowable when the travel is for business purposes.

The draft legislation:

Expenses incurred by traders on food and drink

(1) In calculating the profits of a trade, a deduction is allowed for any reasonable

expenses incurred on food or drink for consumption by the trader at a place to which the

trader travels in the course of carrying on the trade, or while travelling to a place in the

course of carrying on the trade, if conditions A and B are met.

(2) Condition A is met if -

(a) a deduction is allowed for the expenses incurred by the trader in travelling to

the place, or

(b) where the expenses of travelling to the place are not incurred by the trader, a

deduction would be allowed for them if they were.

(3) Condition B is met if –

(a) at the time the expenses are incurred on the food or drink, the trade is by

its nature itinerant, or

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(b) the trader does not travel to the place more than occasionally in the course of

carrying on the trade and either-

(i) the travel in connection with which the expenses are incurred on the food or

drink is undertaken otherwise than as part of the trader's normal pattern of travel in the

course of carrying on the trade, or

(ii) the trader does not have such a normal pattern of travel."

Explanation

Permits a deduction from the profits of a trade in respect of modest subsistence costs

associated with travel, provided the travel expenses are incurred, or would otherwise have

been allowable if so incurred, wholly and exclusively for the purposes of the trade.