Milage repayment query

[boby]

Hello

I have a 12 month IT contract and travel from my home to the clients office twice a week and work from home 3 days per week

For those two visits per week I cycle 12 miles and get a train costing £39.40 or can drive the 120 miles which works out as the following

12 miles cycle = £2.40 + train ticket £39.40

Or £54 (0.45p x 120 miles) + parking

When buying the ticket I prefer to use cash so was wondering how I can get reimbursed for the travel

Withdraw cash from the company account
Pay from my own cash and do a bank transfer weekly/monthly to cover the costs
Are there any HMRC rules I would breach with the above?

Thanks
Bob

[Eirikur]

You have a ticket, so you have proof and you can reimburse yourself from you company account without any problem.

[boby]

thank you

[TheCyclingProgrammer]

You can pay yourself and have YourCo reimburse you (you should keep a log of your personal expense claims) or have YourCo pay directly; it really makes no difference to the paperwork or amounts involved.

If you drive, and just pay yourself mileage + parking:
* The mileage payments are exempt as long as you pay yourself within the prescribe HMRC rates (AMAPs) and do not need to be reported to HMRC.
* The parking costs can be re-imbursed and will not incur any tax however you will need to report these on your P11D (not sure what box) unless you have a dispensation and you will need to to claim tax relief for these payments when you fill out your tax return to avoid getting taxed.

If you cycle and take the train:
* As above, the cycling mileage is exempt.
* The train tickets, whether paid for directly by YourCo or reimbursed, need to be reported on P11D in Box N and tax relief will need to be claimed on your self assessment unless, once again, you have a dispensation.

If you pay in cash, keep the tickets (parking/train) as evidence. It goes without saying that you should only claim the higher car mileage amount if you actually drive.

Despite the P11D reporting requirements, none of the above should be taxable as long as the journeys are incurred for business purposes (including travel to a temporary workplace as in your case). This is subject to the 24 month rule but so long as you are never on-site more than 2 days a week on average the 40% rule will apply and you should be able to continue claiming these expenses for the duration of your contract even if it exceeds 24 months.

[DaveB]

One point, life is a lot easier if you pay directly from the company for train tickets etc. Paying by company debit card means if you lose the receipts you still have proof of expenditure, which is technically all that is required.

[TheCyclingProgrammer]

One point, life is a lot easier if you pay directly from the company for train tickets etc. Paying by company debit card means if you lose the receipts you still have proof of expenditure, which is technically all that is required.

How is that any different from paying yourself (by debit card) and losing the receipts? You still have personal bank statements as evidence.

[SlipTheJab]

With train tickets I think you need the actual receipt (rather than the ticket) since that is proof of purchase.

[TheCyclingProgrammer]

With train tickets I think you need the actual receipt (rather than the ticket) since that is proof of purchase.

Ideally, but a bank statement showing the purchase is unlikely to be queried.

[DaveB]

How is that any different from paying yourself (by debit card) and losing the receipts? You still have personal bank statements as evidence.

The OP said they played in cash by preference.

[SueEllen]

The OP said they played in cash by preference.

It may be a preference but it's time to get with the modern world - contactless* and oyster cards must scare him tulipless.

It's also easier to do your accounting if you do expenses like travel from your company bank account.

*Hint use a credit card as it isn't your money.