Subsistence Allowance: What Exactly Can You Claim? HMRC Rules, Rates & Real-World Examples

Introduction

If you travel for work — whether you are a self-employed CIS subcontractor visiting building sites, a taxi driver taking clients across the city, or an employee attending training outside your usual office — you may be able to claim subsistence allowance as a tax-deductible expense. But the rules around what qualifies, how much you can claim, and whether you need receipts are often misunderstood.

In this guide, FSL Accountancy Limited explains the HMRC rules on subsistence allowance in straightforward terms, with worked examples across several common sectors, so you know exactly where you stand.

What Is Subsistence Allowance?

Subsistence allowance refers to the costs you incur on food, drink, and — in some cases — overnight accommodation when you are away from your normal place of work on business. The idea is straightforward: if you are out of the office or your usual work base because of a business commitment, and that forces you to buy a meal or stay somewhere overnight, HMRC may allow you to deduct that cost from your taxable income.

HMRC describes these as “subsistence expenses” and they sit alongside travel expenses as part of the broader category of allowable business costs. See HMRC’s overview of travel and subsistence expenses for employers for the full framework. The rules differ significantly depending on whether you are:

• An employee (including a company director)
• Self-employed (sole trader, CIS subcontractor, taxi driver, etc.)

Important: Subsistence does not cover ordinary everyday meals. HMRC’s position (BIM47705) is that everyone needs to eat regardless of whether they are working, so a lunch eaten at your usual workplace — or at home — does not qualify.

HMRC Benchmark Scale Rates for 2025/26 — The Official Figures

HMRC publishes what it calls “benchmark scale rates” — fixed daily amounts that employers can pay employees (including directors of their own limited companies) without requiring a receipt for every purchase. The full rates table is published at HMRC EIM05231. The current rates for 2025/26 are:

Tip: The late evening supplement of £10 can be added on top of any of the above rates, provided the business journey is still ongoing after 8pm. A 10-hour trip finishing at 9pm could attract £10 + £10 = £20 in total.

There is also a separate £5 per night ‘incidental overnight expenses’ allowance (£10 overseas) to cover minor costs such as newspapers or laundry during an overnight business stay. This is separate from hotel accommodation costs, which should be claimed at actual cost with receipts.

Is Claiming £5 Per Day Without Receipts Safe and Acceptable to HMRC?

This is one of the most common questions we receive at FSL Accountancy, and the answer is: it depends on your situation.

For Employees and Directors of Their Own Limited Company

If you are a director (or employee) of your own limited company, you can use the benchmark rate of £5 for a qualifying journey of 5+ hours without needing a receipt for the exact amount spent. The rules on scale rate payments confirm that since April 2019 you only need to show evidence that some expense on food or drink was incurred during the trip — a bank statement entry, a single receipt for a coffee, or a contactless payment record is sufficient. You do not need a receipt matching the full £5.

Crucially, this only works if you have genuinely been away from your normal place of work for at least 5 continuous hours as part of a qualifying business journey.

For Self-Employed Sole Traders (Including CIS Subcontractors)

Here the position is stricter. The HMRC benchmark scale rates are primarily designed for employers reimbursing employees — they do not automatically apply to self-employed individuals. Sole traders claiming subsistence must meet the ‘wholly and exclusively’ test under ITTOIA 2005 s.34. See our guide to filing your first Self Assessment as a sole trader for more on how allowable expenses work in practice.

HMRC guidance at BIM47705 is clear that a deduction is only allowable where:

• The expense arises directly from a qualifying business journey
• The trader does not travel to that place on a regular, predictable basis (i.e. it is not their normal base of operations), or the trade is inherently itinerant in nature

A self-employed person wanting to use HMRC’s scale rates should technically obtain HMRC’s agreement first. In practice, most sole traders simply claim their actual receipted costs. Claiming a blanket £5 per day without receipts and without HMRC’s agreement carries some risk if your return is ever reviewed — particularly if the same site is visited repeatedly.

Watch out: If you are a CIS sole trader who works from the same site every day, HMRC may treat that site as your permanent base — meaning travel and subsistence to that site would not be claimable at all.

The Core Rules — What Qualifies as Subsistence?

Whether you are employed or self-employed, HMRC applies a core set of qualifying conditions before subsistence can be claimed:

• The journey must be for business purposes. A routine daily commute from home to your usual workplace does not qualify, however long it takes.
• You must be away from your normal place of work for at least 5 hours (for the basic £5 rate to apply).
• You must actually incur a cost on food or drink during the journey. You cannot claim the scale rate if you brought lunch from home and spent nothing.
• The workplace must be temporary (for employees). HMRC’s 24-month rule (see general scale rate guidance EIM05200) means that if you attend the same location for more than 24 months, or you know from the outset that you will be there for more than 24 months, it becomes a permanent workplace and travel/subsistence stops being claimable.

The 24-Month Rule in practice: If a contractor renews a placement at the same site twice (e.g. 12 months + 12 months), the site becomes permanent from the point it was foreseeable the total would exceed 24 months. After that point, no travel or subsistence can be claimed for visits to that site.

Real-World Scenarios — Can You Claim? Sector-by-Sector Examples

Construction: CIS Subcontractors and Site Workers

If you work in construction, understanding CIS is essential before claiming any expenses. See HMRC’s full CIS guide for contractors and subcontractors and our own CIS accounting services page for background.

Scenario 1 — CIS subcontractor travelling to a different city for a new contract (e.g. Luton-based plasterer working in Birmingham for 3 months)

Ahmed is a self-employed CIS subcontractor based in Luton. He picks up a 3-month contract in Birmingham. He drives there each Monday, works all week, and returns home Friday. His business base remains Luton.

Can he claim subsistence? Yes, provided the Birmingham site genuinely is a temporary workplace and Ahmed’s home/base of operations is Luton. Because the trade takes him away regularly to temporary locations across the country — in line with the Horton v Young principle — the courts have consistently held that workers of this nature are ‘itinerant’ and their travel and associated subsistence costs are allowable. He should retain evidence of actual meal expenditure (receipts or bank statements). As a sole trader he cannot simply apply the HMRC benchmark rates without HMRC agreement, so claiming his actual costs with receipts is the safer approach.

Verdict: Claimable — actual costs with receipts

Scenario 2 — CIS subcontractor attending the same local site every day in the same city (e.g. working on a housing development in Luton for 2 years)

Dave is a self-employed bricklayer who has been working on a large housing development in Luton for 18 months, with 6 months remaining on his contract.

Can he claim subsistence? This is the tricky one. Because Dave attends the same site daily, HMRC may view that site as his permanent base of operations. The 24-month rule is also approaching. If HMRC determines his base is the Luton site rather than his home, neither travel nor subsistence would be allowable for the journey from home to site. Where the site is clearly temporary and Dave works across several sites during the year, there is a stronger argument — but this is a fact-specific question that merits professional advice.

Verdict: Uncertain — depends on whether home is established as the business base

Scenario 3 — A construction firm director (limited company) travelling to inspect a site in another city

James is a director of his own construction limited company and travels from Luton to Leeds for a day to inspect a site and attend a client meeting. He leaves at 7am and returns at 7pm — a 12-hour round trip. He buys a coffee and a sandwich, spending £9.

Can he claim? Yes. As a director-employee of his own limited company, this is a qualifying business journey of over 10 hours. The company can pay him the HMRC benchmark rate of £10 tax-free (without requiring a receipt matching the exact amount), provided there is some evidence of expenditure on food during the journey. The £9 receipt covers this requirement comfortably.

Verdict: Claimable — £10 benchmark rate via limited company, one receipt sufficient

Taxi Drivers and Private Hire Drivers

Taxi drivers and private hire drivers are a classic example of an ‘itinerant’ trade — one that by its very nature involves constant movement between locations. This is significant because HMRC’s guidance recognises that itinerant workers may have different rules applied to them.

Scenario 4 — Taxi driver taking a passenger to a destination in the same city (e.g. Luton to Luton town centre)

Khalid is a self-employed private hire driver based in Luton. He spends his day taking passengers around Luton. Between fares, he buys a meal deal from a supermarket — £4.50.

Can he claim subsistence? This is where many drivers are caught out. Working within your usual city on a routine daily basis — even if you are moving around constantly — is unlikely to qualify as a ‘business journey away from your normal place of work’ in the HMRC sense. HMRC’s view is that a taxi driver’s normal pattern of work includes driving around the city. The same-city meal does not arise from an unusual or exceptional business trip; it arises from his ordinary working day. His meal cost is therefore unlikely to be deductible as subsistence.

Verdict: Not claimable as subsistence — ordinary working day within home city

Scenario 5 — Taxi driver taking a guest to a destination outside the city (e.g. Luton to London Heathrow)

Same driver, Khalid. Today he has an airport transfer from Luton to London Heathrow, then picks up a return fare. The whole trip takes 7 hours and he buys a meal before heading back — £8.50 with receipt.

Can he claim? There is a stronger argument here. The Heathrow trip takes Khalid well outside his normal pattern of local city driving, and the journey is clearly exceptional and business-driven. HMRC guidance at BIM47705 indicates that a deduction is allowable if the expense is reasonable and the ‘trader does not travel to the place more than occasionally.’ See our article on claiming travel expenses as a self-employed person for further detail on the itinerant trader rules. If long-distance airport transfers are a regular feature of Khalid’s work rather than occasional ones, the argument is weaker. Keeping a mileage log and receipts is essential.

Verdict: Potentially claimable if occasional — keep mileage log and receipts

Scenario 6 — Taxi driver on a multi-day trip, e.g. driving a client to Edinburgh from Luton with an overnight stay

Khalid is hired to drive a business client from Luton to Edinburgh, staying overnight and returning the next day. He pays for a hotel and meals over two days. The hotel costs £85. His meals cost £28.

Can he claim? Yes, this is a clear case. The trip is genuinely exceptional, outside his normal working pattern, requires overnight accommodation necessitated solely by the business journey, and the costs are reasonable. Hotel costs should be claimed at actual cost with receipts. Meal costs should also be claimed at actual cost with receipts (as a sole trader he should not simply apply the benchmark rate without HMRC’s agreement).

Verdict: Claimable — hotel and meals at actual cost with receipts

Other Tradespeople, Consultants, and Field Workers

Scenario 7 — Electrician visiting multiple client sites across different towns in one day

Sarah is a self-employed electrician. On a typical day she visits three different client properties — one in Luton, one in Harpenden, and one in St Albans. She is out from 7am to 6pm (11 hours) and buys lunch. She works from home, which is her established business base.

Can she claim? Because Sarah’s trade takes her to different locations each day (itinerant in nature), she has a reasonable basis for claiming the costs of meals incurred during that working day, provided she can show the journeys were for business purposes and she genuinely spent money on food. Keeping a work diary, mileage log, and receipts (even just one for the day as evidence of expenditure) would support the claim. Claiming her actual receipt cost rather than the benchmark rate is the safest approach as a sole trader.

Verdict: Claimable — itinerant trade, actual costs with receipts and mileage log

Scenario 8 — Remote employee attending the office for a mandatory team day

Laura works fully remotely for a company based in London. She is based in Luton and is required to travel to the London office three times per year for company meetings. The journey takes 8 hours total. She buys lunch and a coffee — £12.

Can she claim from her employer? Yes. As an employee attending a temporary workplace (the London office, which she visits infrequently), this is a qualifying business journey. Her employer can reimburse her using the benchmark rate of £10 (for a 10+ hour journey) free of tax and NIC, or can reimburse her actual £12 cost with the receipt. The excess over the £10 benchmark would technically need to go through a P11D or PAYE Settlement Agreement if not on a bespoke rate agreement.

Verdict: Claimable — qualifying business journey to a temporary workplace

What You Cannot Claim as Subsistence

Just as important as knowing what qualifies is knowing what HMRC will not accept. The following are not allowable as subsistence:

• Your daily lunch at your normal place of work — this is personal expenditure, regardless of how busy your day is.
• Meals eaten at home — even if you are working from home, you cannot claim the cost of food you eat there.
• Routine commute costs — travel from home to your regular, permanent workplace is not a qualifying journey and no subsistence flows from it.
• Client entertainment — taking a client out for lunch or dinner is a ‘business entertainment’ cost, which is explicitly disallowed for corporation tax and income tax purposes under ITTOIA 2005 s.45. This is a separate category and should not be confused with subsistence.
• Meals included in a conference or training course fee — if food is provided as part of an event you attended, you cannot also claim the HMRC subsistence rate on top.
• Alcohol — unless incidental to a qualifying meal, alcohol costs attract additional scrutiny from HMRC and are generally not deductible as a subsistence expense.

Common mistake: Many self-employed workers assume that simply being ‘at work’ all day entitles them to claim a daily food allowance. It does not. The key trigger is a qualifying business journey away from the normal base — not just a busy working day.

Do You Need Receipts? Record-Keeping Requirements Explained

If You Are Using HMRC Benchmark Scale Rates (Employees / Directors)

Since April 2019, HMRC removed the requirement to hold a receipt for the full amount of the benchmark rate payment. The scale rate payments guidance on GOV.UK confirms what you do need:

• Evidence that the employee (or director) was on a qualifying business journey — for example, a calendar entry, client email, or mileage record
• Evidence that some expenditure on food or drink was incurred — a single receipt, contactless payment notification, or bank statement entry is sufficient

You do not need a receipt proving you spent exactly £5 or £10. A £2.80 receipt for a coffee is enough to validate a £5 benchmark claim, as long as the journey qualifies.

If You Are Self-Employed (Sole Trader) and Claiming Actual Costs

HMRC requires ‘adequate contemporaneous records’ for all business expenses claimed by the self-employed. This means:

• Keep all receipts for meals and accommodation during business trips
• Maintain a travel diary or mileage log recording dates, destinations, and business purpose
• Bank statements or card records can supplement or substitute for lost receipts in some cases, but original receipts are preferable

HMRC’s guidance at BIM37670 specifically highlights the need for contemporaneous records for self-employed traders. If you are ever subject to an HMRC enquiry, your ability to produce these records will determine whether your subsistence claims are accepted or disallowed. Penalties for poor record keeping can be severe — see our guide to HMRC penalties for late filing and payment to understand the stakes.

Practical tip: Use your phone to photograph every receipt immediately after purchase. Store them in a folder labelled by date and job. This takes 10 seconds and will save hours if HMRC ever asks questions.

Quick Reference — Subsistence Allowance at a Glance

Frequently Asked Questions About Subsistence Allowance

Can I claim subsistence allowance if I work from home?

No — meals eaten at home are not claimable as subsistence. Working from home is your normal place of work in this context. Subsistence only arises when you travel away from your normal work base for a qualifying business purpose.

Can I claim £5 per day subsistence without any receipts at all?

If you are a director or employee using the HMRC benchmark scale rate, you do not need a receipt matching the full £5 — but you do need evidence that some money was spent on food or drink, and that the journey was a qualifying business trip. A bank statement entry, contactless receipt, or similar is sufficient. If you are a self-employed sole trader, you technically need HMRC’s prior agreement to use the scale rates, so most sole traders claim their actual costs with receipts instead.

Does the 24-month rule affect my subsistence claim?

Yes, significantly. If you have been attending the same location for more than 24 months — or it was clear from the outset that you would — HMRC treats that site as your permanent workplace. At that point, neither travel nor subsistence costs for journeys to that site are deductible.

Can a taxi driver claim subsistence for meals during their shift?

For routine same-city driving, no — this is considered the normal pattern of work. For occasional long-distance trips that take the driver well outside their usual operational area, there is a stronger case for claiming actual meal costs. See our guide to claiming travel expenses for more detail on the itinerant worker rules. Each situation depends on the specific facts, and it is worth discussing with your accountant before making a claim.

Is subsistence allowance the same as client entertainment?

No — and confusing the two is a costly mistake. Subsistence is the cost of feeding yourself while travelling on business. Client entertainment is the cost of taking clients out for meals, events, or hospitality. Client entertainment is specifically disallowed as a tax deduction under UK tax law, whereas genuine subsistence is allowable when the qualifying conditions are met.

Where do I register for CIS as a subcontractor?

You can register as a CIS subcontractor on GOV.UK. Our CIS accounting services team at FSL Accountancy can also assist with registration, monthly returns, and claiming back CIS deductions through your Self Assessment.

How FSL Accountancy Can Help You Claim Correctly

Subsistence allowance is one of those areas where the rules look simple on the surface but quickly become nuanced in practice — especially for self-employed workers, CIS subcontractors, and taxi drivers whose working patterns do not fit neatly into the standard employee model.

At FSL Accountancy Limited, our ACCA-qualified team in Luton helps clients across Bedfordshire and beyond to:

• Identify which expenses are genuinely allowable and which carry risk — see our tax preparation services page for more
• Set up proper record-keeping systems so your claims stand up to HMRC scrutiny
• Handle your Self Assessment tax return, ensuring all legitimate deductions are included — without overclaiming
• Advise on the 24-month rule and temporary workplace status for CIS contractors and subcontractors

Getting this right means lower tax bills and fewer HMRC enquiries. Getting it wrong means penalties, interest, and the stress of an investigation.

Contact FSL Accountancy Limited in Luton today to speak with an ACCA-qualified accountant about your subsistence claims. Call us on 01582 806 111 or email contact@fslaccountancy.co.uk.

The information in this article is provided for general guidance only and should not be relied upon as financial or tax advice.