Clarification on "2 year rule"

[Contractor UK]

Thanks for your post Bob. Just to let everyone know that the Contractor Expenses guides, written by Bob, are available at the 'free networking' level of membership. So you don't need to pay £25 to access these, you simply need to sign up to www.contractoralliance.co.uk

[THEPUMA]

Thanks for your post Bob. Just to let everyone know that the Contractor Expenses guides, written by Bob, are available at the 'free networking' level of membership. So you don't need to pay £25 to access these, you simply need to sign up to www.contractoralliance.co.uk

Sorry I am retarded. Can you post a link to the specific webpage where the expense guides are posted please thanks.

[Hex]

Thanks for your post Bob. Just to let everyone know that the Contractor Expenses guides, written by Bob, are available at the 'free networking' level of membership. So you don't need to pay £25 to access these, you simply need to sign up to www.contractoralliance.co.uk

I register, and then I click on the "Contractor Expenses" link in the Members' Area group box and all I get is an advert for Caunce O'Hara. I'm I missing something?

[expat]

The principle behind the 2-year rule is that a person can normally be expected to live close to their place of work; or to put it another way, if you choose to live somewhere not close to your place of work, that is a personal choice and not an aspect of work, so you should not expect tax relief on the cost of that personal choice.

Those who are supposedly based e.g. at their company's registered office (spare bedroom) are allowed up to 2 years taken as being travel from "normal place of work" to client site. But there is a limit, and eventually (after 2 years) you have to admit that you are choosing to live distant from your normal place of work.

Much becomes clear if you look at it from that point of view: for example if you change contracts from one that is conveniently near a main-line station, to one that needs an extra Tube journey on top, that may well increase the inconvenience to you, but it is irrelevant to the "2 years in same location" test. What matters for that is, could you live in a place that was convenient for both? If you could, but instead you choose to live in a place that is convenient for only one of them, that is again your personal choice - so you get away with it for 2 years but not more.

[Bob Jones]

Contractor Alliance - I have told Helen that the link isn't working.
I accept the points made about personal choice but the 24 month rule was, in the draft legislation, a 12 month rule and was set mainly as a restriction on the amount of relief - after numerous representations at the discussion stage a figure of 24 months was decided upon with the unwritten add on that if you want to cut down the expense then move house. Under the old rules home to normal place of employment was denied because it was not in the performance of the duties and the expense was incurred by virtue of where a person lived and that was personal choice. The new rules recognise that where a person is sent somewhere by their employer the expense arises because of where they are sent by their employer and not because of where they live – but the longer a person is at a workplace the stronger the argument that he could move house – another reason for a limitation on amount.
I have had a number of arguments recently regarding the 24 month rule and I am coming across one aspect that is being applied consistently – and incorrectly – by HMRC. One case in particular was dropped by the HMRC Appeals Unit last week after I asked for an independent review prior to listing the appeal before the Special Commissioners. I will be writing further on this subject, and others, in the near future.
Regards

Bob

[basshead]

the longer a person is at a workplace the stronger the argument that he could move house

An interesting aspect of this rule, very interesting thanks Bob. In the current climate its not so easy to move house. Not HMRCs concern but interesting that it comes into it nonetheless.

[NotAllThere]

... So you don't need to pay £25 to access these, you simply need to sign up to www.contractoralliance.co.uk

And live in the UK.

[Contractor UK]

Link working again

Sorry about that: http://www.contractoralliance.co.uk/...ctor_expenses/

[Bob Jones]

Further to my earlier posts I have written an article concerning the 24 month rule and, where appropriate, the further effect of the 40% "rule" (- which isn't actually a rule - it is a rule of thumb which everyone seems to be happy with ..) ...
The article is at http://www.contractoruk.com/news/004120.html or accessible from the home page ..

Regards

Bob

[simes]

re

Hi,

Is there not also an element of whether the project has changed? A lot of what IR35 is about is whether one is considered to be on a project with a finite completion date. ie, not a Support person looking after the general populace for example.

I was told to make my invoices reflect the project and if one is then given a completely new contract with different teams, line managers, different project, and the invoices reflected this, this too would constitute a new start date for the 2 year rule...even if it were the same building.

Could clarification be provided on this too.

Cheers.