Depending on the circumstances, an employee may be able to claim a deduction in calculating their taxable employment income for costs they incur in travelling to their workplace (s338, Income Tax (Earnings and Pensions) Act (ITEPA) 2003). A number of conditions apply, including that the journey is not ordinary commuting, meaning travel to or from a permanent workplace.   

Therefore, in determining if a claim for tax relief may be made, it is important to determine if the workplace is a temporary or permanent workplace. This can be particularly relevant where the person has come to the UK to work (commonly referred to as an inbound expatriate).

HMRC’s campaign 

HMRC is contacting inbound expatriates by letter and email to remind them of the conditions for claiming relief for travel and accommodation expenses relating to a temporary workplace.  

The conditions include that: 

• the expenses are for work only; and
• the expenses haven’t been paid for or reimbursed by the employer. Where the employer meets only part of the costs, the employee can claim tax relief on the remaining part of the costs.  

The correspondence highlights two common errors made when applying the rules (see below).  

HMRC says that the correspondence is not a compliance check and encourages the recipient to follow the guidance in the letter/email when completing their self assessment tax return for 2025/26. Contact details are provided in the letter/email should the recipient have any questions. 

Common error: not a temporary workplace 

Section 339, ITEPA 2003 sets out the conditions that must be met for a workplace to be a temporary workplace.  

HMRC’s letter/email explains that a workplace is not a temporary workplace where the person works there: 

• for at least 40% of their working time; or
• during a period that lasts, or is expected to last more than 24 months. 

HMRC says that the tests should be considered throughout the arrangement. If expectations change – ie, if the person expects to spend more than 40% of their working time at the workplace or to be there for more than 24 months – the workplace will cease to be a temporary workplace from the point the intention changed. The employee may only claim tax relief for travel and accommodation costs incurred while the workplace is a temporary workplace.  

HMRC has published examples illustrating how the rules work in practice.  

Common error: non-work element of costs 

HMRC’s correspondence reminds employees that they can only claim tax relief for their accommodation expenses and not, for example, accommodation expenses relating to their family. HMRC says that, if the accommodation costs more because the person’s family is staying with them, the person should work out how much of the total expense relates to their accommodation only.  

There is guidance on this in HMRC’s employment income manual, at EIM31836, with examples provided at EIM31838.