Question about expenses

[Jackthedog]

Thank you

Firstly I'd point your accountant at threads such as these and ask her to explain herself in detail why she thinks you can't.

Contractor Expenses: Meal Allowances

or tell her to google it and see what she comes up with.

Secondly...



Based on the quote and this thread I'd go get a contractor specialist pronto...

She’s still saying no...I need a new accountant any recommendations?

She said...

The 24 month rule relates to temporary workplaces (EIM32075 & EIM32080). Although, I appreciate, it may seem that London can be treated as a temporary workplace, however, as jack the dog Consultancy Services Limited is a Personal Service Company (PSC), one also needs to consider the “Employment Intermediaries” guidance (EIM32135), Section 339A ITEPA 2003, that was introduced on 6 April 2016, where it confirms, “…that each engagement undertaken by a worker who personally provides their services through an employment intermediary will be considered a separate employment for the purposes of travel and subsistence. This will mean that generally no relief will be given for home-to-work travel costs and associated subsistence…” for the employee.

I mean she is even using the term employee!!!

[northernladuk]

There is an accountant recommendation sticky at the top of the accounting section.

[TheCyclingProgrammer]

You definitely need a better accountant.

The intermediaries travel expense provisions apply to personal service companies ONLY if you are caught by IR35.

If you are outside IR35 you can claim travel costs to a temporary workplace.

https://www.gov.uk/hmrc-internal-man...manual/esm5600

See example 3.

This was all widely published and discussed at the time.

It is also covered here:
I've heard that travel and subsistence expenses are changing? - KF Accounting Services

[Jackthedog]

Further question about travel and accomodation expenses.

Hi...I posted a query a few days ago and need a bit more advice please.

I DONT AGREE HER ADVICE IS CORRECT AND SEEMS NOT TO BE APPLIED TO PEOPLE I KNOW IN VERY SIMILAR SITUATIONS. PLEASE ADVISE AND ALSO ANY RECOMENDED ACCOUNTANTS AS I AM LOOKING TO CHANGE ASAP.


The update is:
She came back to me, saying that it’s due to Intermediaries rules applied in April 2016. Which she believes that although I’m outside IR35 I’m still predominantly working in one location on this engagement so therefore not able to claim tax relief on travel and accomodation to the workplace. Is this correct?

She stated:

The 24 month rule relates to temporary workplaces (EIM32075 & EIM32080). Although, I appreciate, it may seem that London can be treated as a temporary workplace, however, as x Consultancy Services Limited is a Personal Service Company (PSC), one also needs to consider the “Employment Intermediaries” guidance (EIM32135), Section 339A ITEPA 2003, that was introduced on 6 April 2016, where it confirms, “…that each engagement undertaken by a worker who personally provides their services through an employment intermediary will be considered a separate employment for the purposes of travel and subsistence. This will mean that generally no relief will be given for home-to-work travel costs and associated subsistence…” for the employee.

My original post detailed further background as follows

I’m new to contracting and have just set up a PSC limited company (am director and am employee) and started as a worker providing IT Consultancy Services.

I have a client for 6 months, and I will be working with them 100 miles away from home. On a 5 day week basis. I’m outside of IR35, this has been checked.

My accountant is saying I can’t offset my travel expenses against my revenue so I would reduce my corporation tax bill. Is this really right? She is not a contractor specialist accountant.

They are saying I either get a P11d value and tax implication or I have to pay my expenses personally and claim back through dividend (so would have already paid corporation tax).

I always thought justifiable and appropriate travel expenses to a temporary work location were possible to offset against profit, have I been wrong?

[northernladuk]

Why have you posted this again when it's been answered in your other thread?

Your permanent base is home and you travel to your client which is a temporary workplace. It's business travel. Maybe the home office is the bit she's missing. Anyway your other thread answers your question.

Also, and I hope I'm not going to blow your mind here, but you aren't an employee of your LTD.

[Jackthedog]

Thank you northernlad

Why have you posted this again when it's been answered in your other thread?

Your permanent base is home and you travel to your client which is a temporary workplace. It's business travel. Maybe the home office is the bit she's missing. Anyway your other thread answers your question.

Also, and I hope I'm not going to blow your mind here, but you aren't an employee of your LTD.

Sorry I didn’t think my update was clear and I didn’t feel was answered. You haven’t blown my mind...And I’m grateful thank you.
She’s not getting it at all. I stated my perm work location was my home and trading address but she claims my engagement is in one location, even though away from home so I’m not entitled to relief. Throwing all kinds of jargon. Time to fire her.
Thank you again

[malvolio]

Sorry I didn’t think my update was clear and I didn’t feel was answered. You haven’t blown my mind...And I’m grateful thank you.
She’s not getting it at all. I stated my perm work location was my home and trading address but she claims my engagement is in one location, even though away from home so I’m not entitled to relief. Throwing all kinds of jargon. Time to fire her.
Thank you again

Ermm...

Strictly speaking she's not wrong. If you only have the one engagement since starting then that is your permanent workplace. It's only when you have more than one, or a reasonable expectation of getting more than one in a different location, that your home office kicks in as being your permanent workplace. And if you do get a second gig, then you can back claim your original contract T&S taxes.

Of course, most people make the assumption that they will continue elsewhere, but that is not a given.

[WTFH]

I've merged the two threads so that it makes sense to anyone reading.

There's links on the right to contractor accountants, and you may get recommendations from individuals on here as well.

[cosmic]

I'm with intouch accounting. They are pretty good so far for the past year and on time with all the stuff that needs doing.

Yes it should be claimable as you are outside of ir35 and it's only for 6 months so the 24 months rule is not applicable and on the portal it's set as an expense on your directors account that is owed back to you.

My accountant is Daniel and he is pretty good. Free ir35 assessment takes a day or two for review and they have tax / housing specialist
https://portal.intouchaccounting.com/portal/r/b/YQJK

[MrButton]

I'm with intouch accounting. They are pretty good so far for the past year and on time with all the stuff that needs doing.

Yes it should be claimable as you are outside of ir35 and it's only for 6 months so the 24 months rule is not applicable and on the portal it's set as an expense on your directors account that is owed back to you.

My accountant is Daniel and he is pretty good. Free ir35 assessment takes a day or two for review and they have tax / housing specialist
https://portal.intouchaccounting.com/portal/r/b/YQJK

Same and very happy with them so far. However you should also consider using an IR35 specialist in addition. That said - all the advice I've received so far from Intouch has matched that I've received from QDOS.