Umbrella Dispensation - Tax Return

[Snorbs]

I just got round to filling in my tax return.

I have not been submitting/claiming travel & subsistence amounts directly via my umbrella through the year - expecting to be able to claim these all via the tax return (once per year, in one chunk).

I've just spotted that the tax return says not to include items 'claimable' (nothing about 'claimed') under a dispensation.

This seems to shift the timelines for sorting out tax issues from a well published 30 Jan to be determined by the particular umbrella's timelines (which I have now long missed).

NB: the individiual amounts for lunches all fall within the specific umbrella's dispensation rules. I'm not trying to pull a fast one - just claim for what I thought was claimable.

Any ideas as to whether my receipted travel/subsistence expenses can be claimed directly via the tax return if not submitted via the umbrella?

Thx for your informed advice....

[NickFitz]

EDIT: I should point out that I am not an accountant; it's possible a good accountant might be able to find a way round this that I am not aware of. What follows is my best understanding of the situation.

If you're working through an umbrella company then you are an employee of that company working under PAYE for tax purposes, and you claim your expenses from the company. The expenses are then deducted from the amount paid to the umbrella company by the agency or client, prior to PAYE calculations on the umbrella's payroll. You then receive the expenses (which were not liable to tax) and the remainder of the agency/client fee after tax/NI/charges as your combined salary.

Self assessment doesn't enter into it, as you are working under PAYE (although you may have to complete a SA form as well, for other reasons).

Look at it this way: those expenses were incurred in the course of the umbrella company's business, to wit, providing services to the agency which in turn provides those services to the end client; you were employed by the umbrella company to carry out the provision of those services. You were entitled to be reimbursed by the umbrella company for expenses you had paid out of your own pocket on its behalf. If those expenses were legitimately able to be offset against Income Tax, it is against the umbrella company's PAYE bill that they can be offset. However, there is no way your personal SA return can include a component that is to be offset against your employer's tax bill.

As the business of offsetting your expenses against tax relates to your employer's PAYE liabilities, it has nothing to do with the deadline for SA returns. The date hasn't shifted, as the expenses aren't related to your personal tax.

You'll have to ask your umbrella if there's any way they can process a huge chunk of expenses submitted in one go. There probably isn't but you can always ask. In future, you have to remember to claim your expenses back from your employer within the deadlines the employer specifies.

Sorry I can't give you any better news

[RichardCranium]

I would have thought that amongst the benefits of being in a brolly would be:
- they would explain these things;
- they would query why you'd raised no expenses for an entire year.



FFS, does no-one provide a decent, all-inclusive, pro-active service for contractors?

[Fred Bloggs]

FFS, does no-one provide a decent, all-inclusive, pro-active service for contractors?

No. HTH.

[malvolio]

WHS

Novel idea, I know, but the point is you're suppsed to be able to think for yourself. An Umbrella is simply a payroll management function, not your mummy.

[TykeMerc]

I just got round to filling in my tax return.

I have not been submitting/claiming travel & subsistence amounts directly via my umbrella through the year - expecting to be able to claim these all via the tax return (once per year, in one chunk).

I've just spotted that the tax return says not to include items 'claimable' (nothing about 'claimed') under a dispensation.

This seems to shift the timelines for sorting out tax issues from a well published 30 Jan to be determined by the particular umbrella's timelines (which I have now long missed).

NB: the individiual amounts for lunches all fall within the specific umbrella's dispensation rules. I'm not trying to pull a fast one - just claim for what I thought was claimable.

Any ideas as to whether my receipted travel/subsistence expenses can be claimed directly via the tax return if not submitted via the umbrella?

Thx for your informed advice....

I'm inclined to think that you need specialist advice on this, but my initial reaction is that you're well and truly knackered on this issue.

With an Umbrella (typically) you submit expenses, I think they're called Schedule E, they deduct the expenses and their fee which is also an expense from your taxable pay, calculate the tax and NI's on the remainder, deduct that, then add the expenses element back and pay you the total with the tax and NI's to HMRC.

I have absolutely no idea if you can claim the expenses from HMRC on your tax return since you've been paid a salary based on your rate not an untaxed income/profit.
You might well be able to get the 40p/mile back, but the other normally allowable expenses via an umbrella could be very complicated since you've completely abandoned the tax model usually followed with the umbrella type employment.

I'd be quite surprised if the umbrella didn't at least ask if you had any expenses, but as the others have said they don't have an obligation to totally hold your hand and they couldn't know what was in your mind. I'm sure they didn't hide their usual expenses model from you when you signed up, most of the umbrella companies would provide a welcome pack with how their pay and expenses model work.

[ASB]

I just got round to filling in my tax return.

I have not been submitting/claiming travel & subsistence amounts directly via my umbrella through the year - expecting to be able to claim these all via the tax return (once per year, in one chunk).

I've just spotted that the tax return says not to include items 'claimable' (nothing about 'claimed') under a dispensation.

This seems to shift the timelines for sorting out tax issues from a well published 30 Jan to be determined by the particular umbrella's timelines (which I have now long missed).

NB: the individiual amounts for lunches all fall within the specific umbrella's dispensation rules. I'm not trying to pull a fast one - just claim for what I thought was claimable.

Any ideas as to whether my receipted travel/subsistence expenses can be claimed directly via the tax return if not submitted via the umbrella?

Thx for your informed advice....

Read the notes. You are presumably doing it on that piece of cack which is online self asessment. It's the expenses page. Bung em down in the right place and bingo.