We explore the issue of differentiating the valuation of travel time savings (VTTS) in transport cost-benefit analysis, summarising and discussing theories forming the basis for arguments for and against VTTS differentiation. We stress some important implications, insights and consequences of different assumptions relating to these theories, many of which we feel have been underappreciated in much of the CBA literature and practice. We derive a welfare rule including a social cost for monetary redistributions and show the implications for how the VTTS can be defined in different choice situations. Crucially, the applicable VTTS definition depends on whether travel costs (fares) are under public control and to whom benefits accrue in the long run. In some choice situations, the VTTS should be controlled for differences in income, but it is important to always take into account differences in marginal utilities of time (e.g. across travel time components, modes and trip purposes). Using Swedish data, we show that controlling the VTTS for income differences changes the VTTS only slightly; the variation in VTTS across modes, trip lengths, trip purposes apparently stems primarily from differences in marginal utilities of time rather than income.