Mileage and 24 month rule

[Scrag Meister]

You cannot continue to claim travel expenses after 24 months or more with the same client unless your location changes significantly. If there is no real difference in the distance and time travelled to the new site compared to the old the revenue would take a view that the travel costs were not allowable. There is no way around this other than to lie about your location.

Thanks for the response, but how did Wembley v West End allegedly class as a diff location for a previous poster?

Spoke to a couple of contractors at ClientCo recently and they are still claiming expenses after 4-5-6 years, with diff clients but all City/Canary Wharf based.

Once again the honest folks are getting it up the @rse.

[LisaContractorUmbrella]

Thanks for the response, but how did Wembley v West End allegedly class as a diff location for a previous poster?

Well therein lies the problem really SM - it all comes down the the HMR&C definition of 'significant' which is not stated anywhere and is therefore totally subjective; you could ask one revenue operative whether the difference in journey time or distance was significant and they would say yes, another would say no. I would think that, in London, journey time will be the most relevent measure - if it takes you 20 minutes to get to St Pauls but 40 minutes to get to Canary Wharf then that is a significant difference in journey time - if the journey times are about the same then the expense wouldn't be allowable.

[JoeJurcich]

Would a way round the issue be to put your agency address and workplace down but they are in London too?

Well therein lies the problem really SM - it all comes down the the HMR&C definition of 'significant' which is not stated anywhere and is therefore totally subjective; you could ask one revenue operative whether the difference in journey time or distance was significant and they would say yes, another would say no. I would think that, in London, journey time will be the most relevent measure - if it takes you 20 minutes to get to St Pauls but 40 minutes to get to Canary Wharf then that is a significant difference in journey time - if the journey times are about the same then the expense wouldn't be allowable.

[LisaContractorUmbrella]

Would a way round the issue be to put your agency address and workplace down but they are in London too?

That would come under the heading of falsifying your expenses - the 24 month rule applies to the place where you actually work

[northernladuk]

Would a way round the issue be to put your agency address and workplace down but they are in London too?

Becareful using 'ways around' it might seem like that to you but to HMRC it is avoiding paying what you owe which won't be pleasant for you. If you are not eligible you don't get it. Simple as that.

The problem with the 2 year rule from what I was told is that is wasn't really meant for us. It was a time set that is reasonable for someone moving to a new job in a different area to relocate rather than travel. If I lived in London and I got a job in Manchester it would be reasonable for HMRC to cut me some slack while I find if the job works for me and to prepare to relocate to that new place of work which for permies does sound pretty reasonable. The problems are when we all try bending the rules to make it fit. We are expected to travel long distances and change jobs often which these rules were never set up to cope with. A permie lives in North Manchester, he gets a job in Stockport, perfectly reasonable commute. The then gets a job in Sale, which is a fair distance but to him another reasonable commute. Same for London, you could get a job in one area but would be quite happy to commute to a completely diff area. This is where the wooliness comes in, a permie would see it as a reasonable distance to commute and not claim expenses. We wouldn't. We want to re-start the clock just moving to the next town. That is why it gets complicated. This is how it was explained to me. It is assumed there is a level of common sense and assumption that might work for permie examples but not for us who want to work to the letter of the policy.

Thinking like this helped me understand why certain decision I make are right/wrong but I admit it just like the rest of us in some cases it doesn't suit me as I don't know which side of the line to step over. I don't mind commuting to Sale instead of Stockport but if it is legal and right to do so I want to claim expenses. Can I or can't I. There is no answer.

Thats how it was explained to me anyway, rightly or wrongly.

[JoeJurcich]

Hi Lisa,

Thanks for your advice on this and ofcourse i would never falsify anything as far as HMRC are concerned.

That would come under the heading of falsifying your expenses - the 24 month rule applies to the place where you actually work

[JoeJurcich]

Thanks Northernlad
much appreciated, looks like i will either have to go permanant, not claim expenses or find another contract. If i found a new client and a new agency but that was still in London then would this be ok or Could you still use the same agency with a new client in London?

Becareful using 'ways around' it might seem like that to you but to HMRC it is avoiding paying what you owe which won't be pleasant for you. If you are not eligible you don't get it. Simple as that.

The problem with the 2 year rule from what I was told is that is wasn't really meant for us. It was a time set that is reasonable for someone moving to a new job in a different area to relocate rather than travel. If I lived in London and I got a job in Manchester it would be reasonable for HMRC to cut me some slack while I find if the job works for me and to prepare to relocate to that new place of work which for permies does sound pretty reasonable. The problems are when we all try bending the rules to make it fit. We are expected to travel long distances and change jobs often which these rules were never set up to cope with. A permie lives in North Manchester, he gets a job in Stockport, perfectly reasonable commute. The then gets a job in Sale, which is a fair distance but to him another reasonable commute. Same for London, you could get a job in one area but would be quite happy to commute to a completely diff area. This is where the wooliness comes in, a permie would see it as a reasonable distance to commute and not claim expenses. We wouldn't. We want to re-start the clock just moving to the next town. That is why it gets complicated. This is how it was explained to me. It is assumed there is a level of common sense and assumption that might work for permie examples but not for us who want to work to the letter of the policy.

Thinking like this helped me understand why certain decision I make are right/wrong but I admit it just like the rest of us in some cases it doesn't suit me as I don't know which side of the line to step over. I don't mind commuting to Sale instead of Stockport but if it is legal and right to do so I want to claim expenses. Can I or can't I. There is no answer.

Thats how it was explained to me anyway, rightly or wrongly.

[JoeJurcich]

All,

Just to clarify something...

It looks like I will have to get a new contract but if i used the same agency with the new contract would this be ok? The new contract would be somewhere in London or the southeast?

Thanks Northernlad
much appreciated, looks like i will either have to go permanant, not claim expenses or find another contract. If i found a new client and a new agency but that was still in London then would this be ok or Could you still use the same agency with a new client in London?

[northernladuk]

All,

Just to clarify something...

It looks like I will have to get a new contract but if i used the same agency with the new contract would this be ok? The new contract would be somewhere in London or the southeast?

You haven't got the grasp of this yet lol. It is about location you work at.Nothing to do with agents, clients or anything. You need to think about where the new contract is for it to make a difference and use the information given in this thread and all the other threads mentioned in the sticky.

Have to ask as well. Are the expenses so significant that they would make working for the client a non-possibility? Are we right in thinking you have to rent or live in hotels mid week? I can't imagine you would be willing to leave a client or area just over standard commuting costs?

[RichardCranium]

It looks like I will have to get a new contract but if i used the same agency with the new contract would this be ok? The new contract would be somewhere in London or the southeast?

JoeJurcich the person is an employee of JJSoft LtdCo.

JoeJurcich gets sent to do some work for Scroggitts of London in EC1 for 18 months, arranged through Shark Recruitment.
JoeJurcich then gets sent to do some work for Bloggs of London in EC2 for 12 months, arranged through Liars Employment.

JoeJurcich will by then have been employed by JJSoft LtdCo for over two years and working in the City. Expenses cannot be claimed - in this example - after the 18 month point. The fact that you were in a different building up the road and the intermediary bodies are all different, you are still a lowly employee of JJSoft LtdCo working in the City.

You can change job title, contract, agent, terms, client, building and street every week and still fall foul of the 24 month rule. You would still be "JoeJurcich, employee of JJSoft LtdCo, who works in the City".