Mobile phone/broadband expense no longer allowed

[7of9]

When I first started contracting 5 years ago, I was advised by my accountant back then to claim expenses for monthly mobile phone bill (10 pounds monthly) and half of my broadband/landline bill.

Recently, my current accountant has told me that I can no longer do that because I have personal usage i.e. checking my personal emails, checking train time etc.
I have recently upgraded my broadband for work, but according to my accountant I cannot claim a single penny as expense simply because I use broadband to check my personal email as well.

Can anyone shed some light on this?

[northernladuk]

When you say claim expenses I'm assuming both these are personal contracts with and you are only claiming back business calls. If you are on free minutes it means you aren't paying for any business calls so I would say you can't claim anything. It's a personal contract so can't claim the contract costs.

I was also advised not to bother with broadband. The business usage is difficult to quantify but in my situation it was minimal compared to personal use. The actual cost of the contract was low it just wasn't worth it.

[7of9]

When you say claim expenses I'm assuming both these are personal contracts with and you are only claiming back business calls. If you are on free minutes it means you aren't paying for any business calls so I would say you can't claim anything. It's a personal contract so can't claim the contract costs.

I was also advised not to bother with broadband. The business usage is difficult to quantify but in my situation it was minimal compared to personal use. The actual cost of the contract was low it just wasn't worth it.

Thanks northernladuk, my mobile contract is under company's name, but like you mentioned I only use my free minutes so difficult to justify how much are for business. I actually upgrade my broadband for my business, so quite annoyed that I can not claim a single penny...

[Kenny@MyAccountantFriend]

If the phone is in the company name the full cost can be claimed as a business expense as the company can provide all employees with a free phone.

The broadband is all or nothing, if in the company name and mainly for business use the full cost can be claimed, if in your personal name or part of a package you cannot make a claim for this expense.

[Contreras]

Thanks northernladuk, my mobile contract is under company's name, but like you mentioned I only use my free minutes so difficult to justify how much are for business. I actually upgrade my broadband for my business, so quite annoyed that I can not claim a single penny...

If the phone contract is in the company's name and the handset is a company asset bought outright or paid for through the contract then there is no need to apportion the personal use.

[eek]

Thanks northernladuk, my mobile contract is under company's name, but like you mentioned I only use my free minutes so difficult to justify how much are for business. I actually upgrade my broadband for my business, so quite annoyed that I can not claim a single penny...

If the mobile contract is for your company and not a personal contract with the company attached to it it should be exempt.

See https://www.gov.uk/expenses-and-bene...s/whats-exempt which I've just visited to double check if anything has changed...

[TheCyclingProgrammer]

As everyone has already said YourCo can provide one phone for mixed personal and business use. There are several ways of going about it:

* Company buys phone and contract in company name. All allowable, no reporting needed.

* Company buys phone, you use it with a personal SIM. Handset an allowable cost to YourCo (either as an expense or asset depending on how you or your accountant prefer to handle it), personal contract not allowable but you can claim for business calls in full (evidence should be kept, needs reporting on P11D)

* Company pays for contract in its own name, you use it in your own existing phone. Contract costs allowable in full. Nothing to reclaim on the handset.

In all of the above scenarios there is no limits or BIK implications on personal use. This is limited to one phone only. Additional phones can only be provided for business use only (the usual wholly and exclusively rule).

Broadband can't be apportioned if in your name, it needs to be wholly and exclusively for business purposes and it must be in YourCo's name. The same applies for a physical land line.

[northernladuk]

Why do you call the expenses if it's a company phone?

[7of9]

Thanks all! Both mobile contract and broadband/landline contract are in company name. Its fare clear to me now that the mobile contract is OK. But broadband/landline package is used for personal use as well, so I guess that is a NO then.

Thanks again for those applied.

[TheCyclingProgrammer]

If the broadband line is in the company name then using it for any personal use does not mean it's not claimable. It comes downs whether or not the personal use would be deemed "significant". Just the same as how you can make use of your business laptop for personal reasons.

If you had an extra broadband line installed wholly and exclusively for business purposes then I'd say it's claimable even if you occasionally use it for personal reasons. If it's the ONLY broadband line in your home and it's clearly used for both business and personal reasons then I'd say HMRC would have a good case for arguing duality of purpose.