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HMRC internal manual

Employment Income Manual

Particular benefits: late night taxis: third condition: public transport ceased or not reasonable to expect employee to use it

Section 248(2) (c) ITEPA 2003

In certain circumstances there is an exemption from the benefit in kind charge that would otherwise arise where an employer provides a late night taxi for an employee to travel home from work (see EIM21831).

The exemption can apply only where all four late night working conditions are satisfied (EIM21831), and is limited to 60 such journeys in a year. The first late night working condition is explained in EIM21832 and the second condition in EIM21833. If both these conditions are satisfied, the third condition is that by the time the employee stops work

* either public transport is not available for the journey from work to home; or
* it is not reasonable to expect the employee to use public transport.

Public transport no longer available

It is a matter of fact whether public transport for an employee’s journey has ceased by the time an employee finishes working later than usual and at or after 9pm.

If a normal journey from work to home requires an employee to use more than one form of public transport, and one of those forms of public transport for part of the journey has ceased to be available, HMRC accepts that public transport is not available for the whole journey. For example, if an employee works in a city centre, he may take a train from there to the suburb in which he lives and a bus from the train station to the end of the road in which he lives. If by the time of the employee’s journey home after 9pm the train service is still running but the bus service has ceased for the day, we accept that public transport is not available for the journey.

Not reasonable to expect employee to use Public Transport

The legislation does not prescribe circumstances where it would be reasonable for an employer to not expect an employee to use public transport where it is available. However, HMRC does not accept that the exemption applies where a taxi is provided after 9pm to an employee solely on grounds that he or she

* has to travel home from work in the dark; or
* has had a long working day and is tired; or
* has a heavy briefcase, or similar, to take home with them; or
* travels by public transport to a station that is unmanned; or
* the frequency of public transport is reduced.

An employer may consider some or all of these factors when deciding whether it is reasonable to expect an employee to use public transport but none of them is sufficient on its own to satisfy the third condition in the exemption in s248. In many areas, and especially in bigger towns and cities, many employees will be travelling from work to home after 9pm on public transport. The frequency of the service may be reduced compared with earlier in the day but it is reasonable to expect employees to know this from published timetables and to make plans accordingly.

Reduced frequency of service after 9pm is not of itself sufficient cause for the exemption to apply, if the nature and duration of the journey is not significantly different from that at other times of day. However, HMRC accepts that if reduced availability and/or reliability makes it likely that a journey after 9pm would take significantly longer than an equivalent journey at another time of day, the exemption would apply.

The extent to which an employee’s journey from work to home after 9pm on public transport is significantly different from a journey earlier on in the day, so that it is reasonable for an employer not to expect the employee to undertake that journey, depends on the facts in each case.

Apart from the issue of the employee having a significantly longer journey after 9pm, an employer may also consider the employee’s perception of personal safety when deciding whether it is reasonable to expect them to use public transport. As with the extent to which journey times increase after 9pm, each case will depend on its own facts. However, for the exemption to apply, the circumstances of the case must demonstrate a significant difference from the normal situation where people continue to use public transport after 9pm.


  1. An employee is required to work late and until after 9pm on irregular occasions. When she finishes work a train service is available for her usual journey from work to home but the timetable indicates the journey will take nearly two hours instead of the usual 45 minutes. On these occasions the employer provides the employee with a taxi for the journey home.

HMRC accepts that in such circumstances, if the employer decides to provide a late night taxi home the exemption in s248 would apply on the basis that it would be reasonable for the employer to not expect the employee to use public transport which meant an extra hour or more travelling time over his or her normal journey home.

  1. An employee who normally works from 9am to 5pm is required irregularly to work until later than 9pm. The employee’s normal journey on public transport takes 60 minutes but after 9pm it takes 30 minutes longer. While, in itself, her journey home is not significantly longer than normal, she lives in a rural area where, at that time of night, and in the circumstances of her late working, her employer considers that it would not be reasonable to expect her to use public transport and, therefore, provides a taxi. In such circumstances the exemption in s248 applies.