How far apart do workplaces have to be to count as separate under the 24 month rule?
For a workplace to be temporary, you need to be there for under 24 months. If you end up staying longer, then you'll stop getting your tax relief once those first 2 years are over. Even agreeing to stay for longer can mean the site gets classed as permanent by HMRC.
When you move to another workplace, HMRC will decide whether it counts as separate. If it's too close, or the travel costs are too similar, it might end up not counting. The trap here is that you're considered to have accepted a permanent workplace when you agree to move to the new site. Worse still, your old site suddenly no longer counts as temporary either.
Here's an example:
- Bob starts at site A, he’s told from the outset that he’ll be there for 18 months.
- After 12 months, he’s told that once his 18 months at site A are up, he’ll be moving to site B. Site B's just a short hop from his current route to site A, and the same distance from his home.
- He’s told he’ll be at site B for 18 months.
- There is no major difference in the length or cost of Bob's journey. HMRC tells Bob they're basically the same site.
- At the 12-month point, Bob’s expecting his total time on sites A and B to be 36 months. The taxman says this breaks the 24-month limit for temporary workplaces.
- Bob can claim for the first 12 months at site A, but not the last 6. They fall after he agreed to work on site B, which is when the site became "permanent".
As a result, Bob can’t claim anything at all for travel to site B. Again, there are grey areas and pitfalls to watch out for, and every case is likely to be different. As always, though, if there's a genuine claim to be made, we'll always battle HMRC to get your refund paid.
Another example would be if you posted at the Naval base in Portsmouth or Plymouth and have to visit different parts of each town, then those locations would not count due to the distance and you wouldn't be able to claim.
The temporary workplace rules are some of the hardest things to get your head around in tax refund law. RIFT will always fight your corner, but we'll never waste your time trying to claim more than you're entitled to. That's how you know your refund's safe. Even if the taxman ever changed his mind and demanded some of it back, we'd pay it ourselves. That's our unique RIFT Guarantee. If we say you're owed money, you can take it to the bank.