A doctor held a part-time appointment with a nearby hospital and was required under the terms of his contract of employment to be on call for emergency duties. On receiving a call from the hospital, he would usually instruct the hospital staff over the phone and then drive to the hospital. The hospital paid him mileage allowance for the first 10 miles of the journey and he had to bear the cost of the balance personally. The Inland Revenue issued an assessment on the mileage allowance payments received and also refused to allow a deduction for the motor expenses which he had borne personally, on the grounds that they represented “home to office” commuting.
It was held that the mileage allowance payments were not taxable emoluments since the taxpayer had two places of work, i.e. his home and the hospital. It was also held that the excess motor expenses borne by the taxpayer personally were necessarily incurred in the performance of his duties and, therefore, a deduction for these expenses was allowed.