The problem that often arises in the context of travel and subsistence expenses is that they may not meet the wholly and exclusively test, and are hence disallowable in calculating trading profits.
Deductibility of travel costs from home to work
The travel expenses of a self-employed person between his home and place of business or base of operations are not deductible. In Newsom1, a barrister travelling between home and chambers was not allowed a deduction because his base of operations was held to be his chambers in London.
Similarly, an anaesthetist in private practice who travelled between his home, where he maintained an office, and two hospitals where he performed duties at surgical operations, was not allowed a deduction for travel expenses as the two hospitals were his 'places of business'. The FTT noted that these journeys were within the remit of well-established case law that part of the purpose of such journeys was to enable the taxpayer to live away from his work2.
In Horton3, the Court of Appeal, however, held that a subcontracting bricklayer could deduct the expenditure he incurred in travelling from his house to the various sites at which he worked, his house being the 'locus in quo of the trade from which it radiated as a centre'. Moreover it was there stated that 'a circuiteer, that is, the barrister who has his home near London, but spends most of his time on the circuit' would therefore have the locus in quo