Travel and Subsistence Expenses for Sole Traders

Travel and Subsistence Expenses for Sole Traders

A sole trader is entitled to claim a tax deduction for any expenses wholly and exclusively laid out or expended for the purposes of his or her trade or profession.

Revenue has published two Tax and Duty Manuals examining when travel and subsistence expenses pass this test, and are therefore tax deductible.

• Manual Part 04-10-01(PDF, 175KB) examines when travel expenses are allowable Case I / II deductions.
• Manual Part 04-06-17(PDF, 179KB) gives consideration to when food and subsistence payments are allowable deductions.

Revenue has also provided the following guiding principles which sole traders are advised to obey:

• There is no requirement that the expense is necessarily incurred, for the purpose of the trade or otherwise. The necessity is irrelevant once the expense is incurred in furtherance of the trade.
• One must look at the purpose of the expense (whether stated or subconscious) and not just its effects.
• As a general rule, travel between home and work, even if some work is carried on at home, always carries the purpose of getting home – it facilitates living away from work. The duality of purpose renders the expense non-deductible.
• So-called ‘itinerant’ traders are an exception to the general rule that travel between home and work is incurred by the decision to live away from work.
• Home, for such traders, is the only place new customers can contact them, where they store their tools etc. Therefore, they go home to look for new work.
• In these instances, getting home is an effect and not a purpose of the journey.
• It is not necessary to determine where a trade is carried on, or to establish a ‘base of operations’. Travel between a home office and a main ‘base of operation’ will not necessarily be deductible. One must look solely to the
• statutory test, the main focus of which is the purpose for which the expenditure was incurred.
• There is a distinction between “travelling in the course of a business and travelling to get to the place where the business is carried on”.

For more on Travel Benefits and Entitlements read:

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