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Very worrying - the expenses thing

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    Originally posted by TheCyclingProgrammer View Post
    If you have the right to refuse assignments or send a substitute then you shouldn't need to worry but has your contract been reviewed?
    Originally posted by Contract
    “Consultant” means the primary representative of the Company as identified in
    Schedule 1 or such other representative of the Company (known as
    “Other Personnel”) that the Company may provide in accordance
    with Clause 4.9 of this Agreement.
    Yep.

    Originally posted by TheCyclingProgrammer View Post
    Regarding expenses these changes have no effect on how and what you bill your client, only on what you can claim back from YourCo without incurring tax.
    Yes, so this is specifically what I am interested in...if it will sting me. In the case that the expenses I claim back are for going to different end customers, in different locations on most days - will I still fall foul? Because when I compare this to a permanent employee, they can work for joebloggs company down the road and obviously claim nothing for daily "commute" but whenever they're sent to other sites, or clients, they get reimbursement of expenses in full that is not subject to tax?

    My client is not an agency, my contract is between my company and an agency though...the client I work for is a large professional computing services company, but their clients are various companies for which they have won contracts to do work for. They body shop me to work on their behalf on various companies.

    Comment


      Originally posted by ndoody View Post
      Yep.



      Yes, so this is specifically what I am interested in...if it will sting me. In the case that the expenses I claim back are for going to different end customers, in different locations on most days - will I still fall foul? Because when I compare this to a permanent employee, they can work for joebloggs company down the road and obviously claim nothing for daily "commute" but whenever they're sent to other sites, or clients, they get reimbursement of expenses in full that is not subject to tax?

      My client is not an agency, my contract is between my company and an agency though...the client I work for is a large professional computing services company, but their clients are various companies for which they have won contracts to do work for. They body shop me to work on their behalf on various companies.
      We've already given you enough guidance to be able to go and try understand it and we've also answered you directly. What more do you want? Jesus.....
      'CUK forum personality of 2011 - Winner - Yes really!!!!

      Comment


        Originally posted by ndoody View Post
        I have a question about this expense stuff.

        Is it just about the expenses that people claim back for going to/from a single place of work? i.e. a 6 month contract in London for barclays say, then you claim expenses for going down mon-fri and staying over?

        How about if you're working for a company, and that "normal place of work" or "the office" was in one place...but that company actually sends you to various client sites which could be sometimes 3-4 different clients in one week. Are they also saying we have to pay tax on those expenses? That would just blow, because surely even a permy doesn't have to pay any tax on expenses reimbursed for visiting different sites.

        My job involves never going to the actual companies office, because they do send me all over country/world to all their various client sites. Jesus if I was taxed on some of the expenses occurred leaving the country I'd probably end up having to pay out just to work.
        In that case you claim the expenses from the client & make sure it's detailed on your PD11 (I think) form.

        Comment


          Originally posted by Its An Interesting Thing View Post
          In that case you claim the expenses from the client & make sure it's detailed on your PD11 (I think) form.
          Christ on a bike...
          'CUK forum personality of 2011 - Winner - Yes really!!!!

          Comment


            Originally posted by northernladuk View Post
            We've already given you enough guidance to be able to go and try understand it and we've also answered you directly. What more do you want? Jesus.....
            And I got your reply was simply no it won't affect me.

            However, thecyclingrprogrammer chimed in with :-

            Regarding expenses these changes have no effect on how and what you bill your client, only on what you can claim back from YourCo without incurring tax.
            Leading to a logical further requirement for explanation, because I don't know about you but "No" and this reply don't quite stack up...Jesus...

            Comment


              Originally posted by ndoody View Post
              And I got your reply was simply no it won't affect me.

              However, thecyclingrprogrammer chimed in with :-



              Leading to a logical further requirement for explanation, because I don't know about you but "No" and this reply don't quite stack up...Jesus...
              You have the right answer, it won't affect you, with the expenses claimed back from your client, as you decsribed.
              Capiche?
              The Chunt of Chunts.

              Comment


                Originally posted by MrMarkyMark View Post
                You have the right answer, it won't affect you, with the expenses claimed back from your client, as you decsribed.
                Capiche?
                He isn't claiming the expenses from his client, he's expensing them from HisCo. HisCo is then re-charging those expenses to the end client which is just part of its overall service charge.

                So it could affect him; if he incurs a £100 travel expense, he could continue to re-charge £100 to his client by invoice however for him to get the £100 back in his pocket tax free he has to expense claim it. Fine under the current rules but if under the new rules the travel cost is no longer allowable, he will either have to:

                a) Leave the £100 in the company where it will in effect become profit (as there is no expense claim to cancel it out) and taxable or,

                b) Withdraw the £100 as an expense claim as before but it would then be treated as a taxable benefit in kind or,

                c) Withdraw extra income from the company each year to cover the no longer allowable expenses as dividends but incur higher rate tax on these (assuming already drawing dividends up to the higher rate threshold)

                Taking Option A means paying the least amount of tax and leaves an extra £80 of retained profit sitting in the warchest but still leaves you personally out of pocket. Options b) and c) will mean you are not completely out of pocket but obviously worse off than before - the dividend route (under current tax levels) would mean you'd only get £75 of the cost back and as it comes out of company post-tax profits it would actually cost you more in dividends than what you re-charged the client as to take a £100 dividend you'd need £125 profit; option b) would reduce the company's profit by £100 so wouldn't incur any corporation tax but there would be higher rate income tax and NIC to pay.

                At least he can still re-charge the expenses to the client - many of us don't have that luxury!
                Last edited by TheCyclingProgrammer; 13 August 2015, 21:38.

                Comment


                  Is that right? Wasn't the rule to disallow claims where a permie couldn't like your home and permanent work place. If other perm engineers claim petrol and running costs then his claims won't fall within the rules. Travelling like this is hardly abuse of the system as they see it.

                  This new measure aims to prevent umbrella or limited company employees for claiming tax relief on travel and subsistence, where a traditional employee performing the same type of job, would be unable to do so.
                  'CUK forum personality of 2011 - Winner - Yes really!!!!

                  Comment


                    He isn't claiming the expenses from his client, he's expensing them from HisCo. HisCo is then re-charging those expenses to the end client which is just part of its overall service charge.
                    Doh, yes, correct !

                    Good explanation.
                    The Chunt of Chunts.

                    Comment


                      My understanding of claiming expenses is that this is when you spend the money yourself and then claim if from your company. What happens if my company pays for the travel or accommodation directly? Will this still be allowed or will this be stopped as well and if so how?

                      The other issue I see with this is what happens if you have multiple contracts one through an agency and one direct (yes this has happened to me before) or if you Plan B starts generating income for your Ltd while you are working through an agency how will expenses be handled then assuming you are not allowed to claim if you are through an agency.

                      Comment

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