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Navigating the Rules: Traveling Expenses and Tax Deductions

Updated: Aug 22, 2023


The deductibility of travel expenses has been a common issue disputed between taxpayers and tax authorities.

Several landmark UK tax cases have established important principles that guide the resolution of such disputes in Malaysia as well.

Revenue Law

Under Malaysian tax law, expenses are deductible under Section 33(1) if they are wholly and exclusively incurred in the production of gross income.

However, travel expenses incurred between an individual's residence and place of employment are treated as personal expenses and disallowed under Section 39(1)(d).

Inland Revenue's Position

The Inland Revenue assumes that daily travel between an individual's residence and a usual place of work is a personal expense related to allowing the person to live at home while working.

Therefore, such travel costs are not incurred in the production of income and not tax deductible.

Court's Position

The courts in cases like Mallal, Newsom and Taylor have affirmed the principle that expenses for travel between home and the regular place of employment are generally non-deductible private expenses rather than business expenses.

This is so even if some work is done from home.

However, the courts have distinguished this from travel between two places of work/employment, which may be deductible if necessarily incurred for work purposes rather than private purposes.

Mallal v Pitkeathly (1952) 2 All ER 401, which was a key tax case in the UK regarding the deductibility of travel expenses.

The key points of Mallal's case:

  • Mallal was a barrister who lived in Cambridge but often had work in London. He claimed deductions for train fares incurred travelling between Cambridge and London.

  • The tax authorities disallowed the deductions, arguing the travel expenses were incurred travelling between home and work.

  • Mallal appealed the decision. The House of Lords allowed Mallal's appeal and held that the travel expenses were deductible.

  • The Lords found that as a barrister, Mallal's place of work was both Cambridge, where he lived and London, where he often worked. Therefore the travel between the two was for business purposes and deductible.

  • This case established the precedent that travel between two places of work is deductible if the travel is necessary for employment duties.

Newsom v Robertson [1952] 1 All ER 767 is another landmark UK tax case related to the deductibility of travel expenses. The key points are:

  • Newsom was a barrister practising in London. He claimed deductions for travelling from his home to courts/chambers.

  • The tax authorities disallowed the claims, arguing the travel was from home to work.

  • Newsom appealed. The House of Lords dismissed his appeal and upheld the tax authorities' decision.

  • The Lords distinguished this case from Mallal's case. They found Newsom essentially had one place of work - London. Travel from his home in London to courts/chambers in London was not travel between two places of work.

  • Therefore, Newsom's travel expenses were non-deductible as they were incurred in travelling between his home and his regular place of work.

  • The Lords emphasised that the test is whether the expense was necessarily incurred in performing the employment duties.

Taylor v Provan [1975] AC 194 is another relevant UK tax case concerning the deductibility of travel expenses:

  • Taylor was a professional musician who lived in London but had engagements at various venues.

  • He claimed deductions for transporting himself and his instruments between his home and performance venues.

  • The tax authorities disallowed the claims, arguing the travel was between home and work.

  • Taylor appealed. The House of Lords dismissed the appeal and upheld the tax authorities' decision.

  • The Lords held that the essential character of the whole journey was private travel, merely to enable Taylor to live at his home and work at the performance venues.

  • The fact that he had to transport instruments did not alter the nature of the journey from home to work.

  • Therefore, the travel expenses were not incurred in performing his duties and hence were not deductible.


Based on these precedents, travel between an employee's residence and regular place of work would not satisfy the wholly and exclusively test for deductibility under Malaysian tax law.

However, travel between two places of employment may be deductible if incurred for business purposes.

Takeaway for Malaysian Taxpayers

When claiming deductions for travel expenses, Malaysian taxpayers must be able to show the expenses were necessarily incurred for business purposes rather than private purposes.

Keeping detailed records is essential. Expenses related to commuting or travel to the usual place of work are generally not tax deductible.


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