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HMRC internal manual

Employment Income Manual

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HM Revenue & Customs
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The general rule for employees expenses: in the performance of the duties

 

An expense cannot be deducted under the general rule for employees’ expenses in Section 336 ITEPA 2003 unless it is incurred “in the performance of the duties of the office or employment”. The Courts have emphasised the importance of finding out exactly what the duties entail, see EIM31635, and have traditionally taken a very restrictive approach.

In Nolder v Walters (15TC380) Rowlatt J commented at page 387 that the phrase means:

“in doing the work of the office, in doing the things which it is his duty to do while doing the work of the office.”

Therefore, to satisfy this test, the expense must be incurred in actually carrying out the duties of the job. It is not enough for the expense to be relevant to the job, or to be incurred in connection with the duties of the job. Nor is it enough if the expense only puts the employee in a position to start work or keeps the employee qualified to do the work. Expenses that are incurred in preparation to carry out the duties of the employment or as training to carry out the duties of the employment are not deductible.

The effect of this rule is illustrated by example EIM31653.