SE34002 - Travelling expenses: employees working abroad - the Schedule E expenses rule - expenses that may be deducted

In many cases a deduction is due under Section 198(1) ICTA 1988 for expenses that are not deductible under the special rules in Sections 193 and 194 ICTA 1988.

For example, a deduction under Section 198(1) does not depend on the employee’s residence status. The employee’s residence status is important for sections 193 and 194, see SE34010.

A deduction under Section 198(1) may be due whether or not the expense has been reimbursed by the employer. In many cases a deduction is only due under Sections 193 and 194 where the expense has been reimbursed by the employer, see for example SE34025.

A deduction may also be due under Section 198(1) in the following circumstances.

• Travelling appointments, see SE32020.
• Overseas conferences and study tours, see SE31950.
• Travel between two places of work, see SE32020.

On the other hand, the special rules in Sections 193 and 194 may permit a deduction where the general rule in Section 198(1) does not. For example, Section 198(1) does not permit a deduction for the cost of travelling to a workplace where the employee expects to be at that workplace for a period of continuous work lasting more than 24 months, see SE32080. A deduction may be due in these circumstances if the conditions of Sections 193 and 194 are met.

The difference between the rule in Section 198(1) and the rules in Sections 193 and 194 is illustrated by example SE34030.