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TAX CASE: HOME IS PLACE OF
BUSINESS |
The taxpayer, Paul Mellor, a
self-employed electrician, worked on various sites. He
travelled to the locations by car and claimed motor expenses
for the journeys. Citing the decision in Horton v Young 47
TC 60, he claimed his home was also his work base, so the
travel was wholly and exclusively for the purpose of his
trade. He said he had no other office, all his business
records were kept in his home, all correspondence was sent
to his home address, and he kept some small tools and
equipment there when not using them.
HMRC disallowed his claim, saying
that, although the taxpayer might do some work at home, it
was not where he carried out his trade as an electrician.
His travelling costs were not allowable because they were
not wholly and exclusively for the purpose of his business.
The First-tier Tribunal said a
subcontractor like the appellant had to have a base for his
business. Arranging work was integral to being a
subcontractor and the administration in dealing with that
had to form part of his trading activity. He carried out the
administrative part of his trade from his home, therefore
his business base was his home. The taxpayer's appeal was
allowed, subject to the figures being agreed.
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