renting close to gig

[JonSmile]

Hi,

If I rent a place close to gig but only about 2 miles away from main office of MyCo. (i.e. my home), can I get away with claiming the costs back on the rental from MyCo?

I know I could be pushing it slightly here, but have to ask just to see what people here think..

[The Wikir Man]

If it's a legitimate business expense, then claim it.

I can't understand why you would want to spend additional rent to save 2 miles of travel to clientco, unless you have shacked up your mistress in the other place and don't want the Mrs to find out.

[JonSmile]

close, but not quite - about to buy a new house and will need a few months to do it up so it will be easier to stay away while chaos rules there (but could stay if needed).

So thought that the business could stump up and save me some Corp Tax!

[The Wikir Man]

I think you'd have difficulty proving that it was a legitimate business expense to pay for it, to be honest.

IANAA.

[northernladuk]

doesn't a bit of common sense come in to play here? Question really should be how open are you to risk. you could try but you are on a wish and a prayer if anyone comes looking.

[Drewster]

doesn't a bit of common sense come in to play here? Question really should be how open are you to risk. you could try but you are Hectors Biatch if anyone comes looking.

I think you might be <ahem> pushing your luck...... but give it go and let us know how it goes.

[meridian]

close, but not quite - about to buy a new house and will need a few months to do it up so it will be easier to stay away while chaos rules there (but could stay if needed).

So thought that the business could stump up and save me some Corp Tax!

Common sense doesn't necessarily have to apply, but the tax statutes do.

Hector can't tell you what to spend your company money on - if you want a Ferrari as a company car instead of a nice safe Volvo he can't say no; neither can he force you to stay in a Travelodge instead of the Marriott. And whether your business lodgings are 2 miles or 200 is none of his business.

YourCo can pay for the lodgings, but whether they are a deductible business expense depends on whether they were incurred solely in the production of assessable income. Will your family also be staying there? Will you be returning to the family home on the weekends? To what extent is the property being used for personal reasons?

These are rhetorical questions by the way, you've already answered the main question of whether the expense is incurred in the production of assessable income and the answer is no - it is incurred for personal reasons. Therefore, even though the company can stump the cost, you'll be paying all that tax saved back as benefit in kind.

[pmeswani]

I think you'd have difficulty proving that it was a legitimate business expense to pay for it, to be honest.

IANAA.

I would agree.

But hypothetically speaking, if I secured a contract with a clientco that is, let's say, 200 miles away from my normal trading address (i.e. my home), would I be allowed to rent a place and claim it through the business? Could it be argued that I wouldn't have rented the place if I hadn't secured the contract? Could I also argue that I would stay the weekend at the rented place as it would not be cost efficient to travel back to my trading address on weekends? If so, how would one claim the cost of the rent, bills, council tax, etc (i.e. the whole bill or just n/7th's - where n can = 1 to 7)?

This is purely a hypothetical question mind you...

[LisaContractorUmbrella]

I would agree.

But hypothetically speaking, if I secured a contract with a clientco that is, let's say, 200 miles away from my normal trading address (i.e. my home), would I be allowed to rent a place and claim it through the business? Could it be argued that I wouldn't have rented the place if I hadn't secured the contract? Could I also argue that I would stay the weekend at the rented place as it would not be cost efficient to travel back to my trading address on weekends? If so, how would one claim the cost of the rent, bills, council tax, etc (i.e. the whole bill or just n/7th's - where n can = 1 to 7)?

This is purely a hypothetical question mind you...

There is no reason why you could not rent somewhere. It is claimable as a business expense provided that it is an additional cost caused wholly because of the contract. The only time it would not be claimable would be if you had rented out your original accomodation and were receiving income that covered the rent or mortgage as the secondary accomodation would then not be an additional cost.

[northernladuk]

Common sense doesn't necessarily have to apply, but the tax statutes do.

Hector can't tell you what to spend your company money on - if you want a Ferrari as a company car instead of a nice safe Volvo he can't say no; neither can he force you to stay in a Travelodge instead of the Marriott. And whether your business lodgings are 2 miles or 200 is none of his business.

YourCo can pay for the lodgings, but whether they are a deductible business expense depends on whether they were incurred solely in the production of assessable income. Will your family also be staying there? Will you be returning to the family home on the weekends? To what extent is the property being used for personal reasons?

These are rhetorical questions by the way, you've already answered the main question of whether the expense is incurred in the production of assessable income and the answer is no - it is incurred for personal reasons. Therefore, even though the company can stump the cost, you'll be paying all that tax saved back as benefit in kind.

Your analogy is not correct in this instance I believe... The cars and the hotels yes because you have a need for a car, the type doesn't matter, and a need for the hotel, the name doesnt matter. In this case he does NOT need to rent the house so you are comparing apples and pears.