Our client gets paid a per diem disturbance allowance, this is included in his taxable pay. This amount is to cover any and all expenses relating to having to work away from his normal workplace. He then pays his own costs of travel out of that.
There is no question that his place of work qualifies as a temporary workplace and HMRC have not queried that, they have however stated that they will not issue a repayment we have claimed on his tax return as he has been reimbursed for his travelling costs. It is our position that as his reimbursement is included in his taxable pay he is entitled to a tax rebate on the actual costs of travel.
Have HMRC got a leg to stand on? I am convinced that by both the letter and the spirit of the law that he is entitled to this rebate as he has effectively been taxed on money he has not received but I'm concerned perhaps I've missed something, would be interested to know people's thoughts one way or the other.