UT/2023/000049 - [2024] UKUT 00233 (TCC)

To recap, section 338 ITEPA prevents a deduction for expenses of “ordinary commuting”, which is, broadly, travel to and from an employee’s “permanent workplace”. A permanent workplace is defined by section 339(2) as “a place which (a) the employee regularly attends in the performance of the duties of the employment, and (b) is not a temporary workplace”. “Temporary workplace” is defined by section 339(3) and, by virtue of section 339(5)(a)(ii), a place is not regarded as a temporary workplace if the employee’s attendance is in the course of a period of continuous work at that place comprising all or almost all of the period for which the employee is likely to hold the employment.

The FTT decided that there was no overarching contract of employment and that each assignment was a separate employment. We have rejected Mainpay’s appeals against those decisions. As a consequence, each workplace at which a worker carries out an assignment is prevented from being a temporary workplace by s 339(5)(a)(ii) on the basis that the period of “the employment” is the period of the assignment and that the individual will attend the workplace for all or almost all of that period.

One might be forgiven for thinking that if each workplace was not a temporary workplace, it must necessarily be a permanent workplace, so triggering the disallowance of deductibility of travel expenses. Before the FTT, however, Mr Firth argued that this did not follow. His submission was helpfully summarised at FTT[152]-[153] as follows:

The FTT rejected this argument. It decided that (1) as a matter of statutory construction, a workplace which was prevented from being a temporary workplace was necessarily a permanent workplace, and (2) even if this was wrong, an employee who attended a workplace every day during which an employment subsisted must be taken to “regularly attend” that workplace.

By Ground 3 Mainpay appeals against the FTT’s decision on both of these issues.

Before we discuss this ground of appeal, we record that we have some concern that it might be academic, or very largely academic, on the facts of this appeal. Even if one accepts the submission that there is a “third category” of workplace, Mr Firth’s argument then relies on an employee not being in “regular attendance” for a “short assignment”. However, as the FTT noted, at FTT[168], Mainpay’s own evidence appeared to show that the average assignment lasted eight weeks, so there would be “few instances” where the workplace would not have been regularly attended. It is not part of the appeal process, including the time and resource of this Tribunal, to determine issues which are not relevant on the facts. In our view it would have been preferable if Mainpay’s application for permission to appeal on this ground had been considered against evidence of specific assignments (and corresponding expense reimbursements) said by Mainpay to be so short as not to have resulted in regular attendance.

Mainpay appeals against the FTT’s decision that, as a matter of statutory construction, there was no third category of workplace, so that a workplace which was not a temporary workplace must be a permanent workplace. However, if we were to agree with the FTT’s interpretation of the phrase “regularly attends”, that would be sufficient to dispose of this ground of appeal. Therefore, we begin by considering that question.

We proceed, for this purpose only, on the assumption that in order for a workplace to be a “permanent workplace”, section 339(2) requires that, in addition to not being a temporary workplace, the workplace must be one which “the employee regularly attends in the performance of the duties of the employment”.