SE34130 - Foreign travel rules: meaning of “travelling expenses”

Sections 193 and 194 ICTA 1988

The legislation relating to the rules described at SE34020 – SE34080 uses terms such as:

• expenses of travelling
• expenses incurred on a journey and
• travel facilities provided for any journey

They are not defined but where they refer to travel or a journey they should all be read as covering both

• fares and
• subsistence expenditure while travelling

Example 1

If an employee travels from London to Milan to take up a new employment in Italy, Section 193(3) allows “…the expenses of the employee in travelling…”. If the individual travels by train, eats meals on the train and stays overnight in a hotel to break the journey, all of the following costs are allowable:

• Rail fare
• Meal costs
• Cost of hotel accommodation while on a journey.

Example 2

The employee in Example 1 is out of the United Kingdom for more than 60 days so the family travels to Milan to visit. They incur the same costs as those listed above which are met by the employer. In addition, the employer pays for the family to stay in a hotel in Milan. The costs are all ultimately met by the employer and are chargeable as emoluments of the employment. The following costs are allowable by virtue of Section 194(2)

• Rail fare
• Meal costs
• Cost of hotel accommodation while on a journey.

However, the benefit of the family’s hotel accommodation in Milan is not allowable.