§ Expenses incurred by a single person on lodging rents when travelling away from his normal permanent domicile wholly necessarily and exclusively in pursuit of his trade, vocation or profession may be claimed as a relief from tax under the appropriate Schedule.—[Mr. Hooley.]
§ Brought up, and read the First time.
§ Mr. Frank Hooley (Sheffield, Heeley)
I beg to move, That the clause be read a Second time.
The clause covers a small but not unimportant point. In the Bill the Minister and his colleagues have been graciously distributing £1 million here and £2 million there to business and property interests for which special arguments have been advanced. 1 am seeking a modest concession for the ordinary working chap who, for one reason or another, has the misfortune to have to work away from home. A considerable number of hon. Members share that misfortune.
At present a married man who has to work away from home in his professional or trade capacity can claim against tax the lodging charges and so on that he has to pay when it is not practical, convenient or economic for him to return home that night,. That is reasonable. The fact that a man is away from home does not reduce his obligation 1550 to make his mortgage payments, pay his rent, rates and, if he has a family, lighting and heating charges. He has to pay lodging charges in addition. My argument relates only to a man who is obliged to be away from home for trade, professional or vocational reasons. A married man should be entitled to tax relief for the extra expense.
However, a single person who has to travel away from his normal domicile is not entitled to claim an allowance for the extra expense incurred by staying away. It may be argued that a single man can live wherever his job takes him at any time, and that there is no reason why he should incur a double expense, particularly if he is living with parents or relatives, when no extra expense would be incurred. That is a limited argument. Nowadays large numbers of single persons have their own flats and even their own house, and prefer not to live with relatives or friends. They will incur extra expenses when they have to stay away on business, in addition to paying their mortgage, rent, rates and so on for their permanent dwelling.
I agree that there might be a modest saving in heating and lighting because a married man's family would still require those services while he was away. However, single people with a house or flat of their own incur extra expense when they work away from home and have to pay hotel bills or lodging rents. They cannot contract out of the basic rents and rates payable on their permanent homes.
Such people ought to be able to make a claim against tax for the additional expenses incurred in the course of their trade or profession. I do not say that they should be able to claim tax relief every time they travel away from home, for whatever purpose, but when travel is clearly in pursuit of their work they should be entitled to tax relief.
The Minister may tell me that relief is available at the discretion of inspectors of taxes. If that is so, it is unsatisfactory, because the essence of a concession is that sometimes it might not be exercised. I believe that it would be unfair for any single person to be denied the ability to offset extra expenses, which may be considerable, incurred in the circumstances that I have outlined.
1551 I hope that I shall receive a satisfactory explanation of the situation or an assurance that the matter will be looked into and remedied.
§ The Financial Secretary to the Treasury (Mr. Nigel Lawson)
If the law were as the hon. Member for Sheffield, Heeley (Mr. Hooley) outlined, I would agree with his comments, but I can assure him that the law is not as he suggested. There is no discrimination of the sort that he implied between the married man and the single man or between the employed and the self-employed.
Any one of those groups is entitled to relief in respect of lodging expenses, provided that they are incurred—in the case of an employee—wholly, exclusively and necessarily in the performance of his duties or—in the case of the self-employed—wholly and exclusively for the purpose of his trade, profession or vocation. Nor is there any distinction between the married and the single person. It would be wholly wrong if a single employee could get relief only at the discretion of the Inland Revenue. But that is not the case. He has that relief as of right.
There is a difference in the procedure used by the Inland Revenue. It is not the difference that was suggested by the hon. Member for Heeley and it would not be affected by the new clause, but it may be what he had in mind.
When an employer pays his employees a lodging allowance, he can do so without deducting tax provided that they are no more than reasonable payments for the extra living expenses incurred by employees working temporarily away from home and their normal place of employment. In the case of certain such allowances paid under working rule agreements negotiated between employers and the unions involved for highly mobile employees in the construction and allied industries, married employees are required, before the allowance can be paid tax-free, to complete a certificate stating that they have spent the period away from home.
Single employees, however, do not have those certification arrangements open to them and they cannot get their allowances paid tax-free in the first place. 1552 That is because the great majority of single employees do not have permanent homes. However, many do, and are in the circumstances to which the hon. Member for Heeley referred. It is open to any of them, if they have received a lodging allowance after deduction of tax to establish to the satisfaction of the Inland Revenue that the additional expenses were incurred whilst they were working away from their normal place of work. If they can satisfy the Inland Revenue, they can get a refund of the tax paid on the allowance.
That is the procedure by which the single man gets his refund. Except for the procedural difference, he is in precisely the same position as the married man.
§ Mr. Hooley
I am much obliged for that explanation. In the light of it, I beg to ask leave to withdraw the motion.
§ Motion and clause, by leave withdrawn.