Rather new to this (2 weeks in). I have an initial 2.5 month contract in the City (outside IR35). Commute @ £7/day (on my Oyster card). Have just realised that I can claim this as a business expense (I think this is right), because it's a temporary workplace. What documentation should I keep, or can I simply allocate £7/day and get my company to pay me that as a reimbursed expense (because the amounts are so small they would not want a receipt)?
So what else am I missing? How creative do you people get? On £100k of turnover, how much are you putting through as expenses?
So far I have:
Computer/networking equipment purchases.
Internet access for home
Second phone line rental
Mobile phone line rental for business phone (XDA on data tarriff)
How about 'entertaining'? As I understand it this is not allowable for corporation tax purposes, but it might save money because it reduces the amount paid to me as a dividend. So rather than receiving £50k dividend, around £18k of which is subject to higher rate tax, the company spends £250 on entertainment, and gives me £49,750, so I save paying higher rate tax on that £250 (which I would have spent instead myself).
As these more contentious items do not have tax relief for corporation tax, it seems that it's only useful to reduce my higher rate tax burden.
I can see that for many PSCs entertainment in reality is not a real business expense, because they don't really build relationships, but just apply for jobs via employment businesses. So obviously I don't want to take the piss, and put through every meal out with the wife (who is company secretary).
But at the same time if there's something that can be legitimately used to reduce tax (e.g., I understand that there's £150 for staff parties which can be spent without attracting a taxable benefit in kind), then I would like to do so.
So all suggestions on what you deduct and not have considered a benefit in kind would be welcome.
So what else am I missing? How creative do you people get? On £100k of turnover, how much are you putting through as expenses?
So far I have:
Computer/networking equipment purchases.
Internet access for home
Second phone line rental
Mobile phone line rental for business phone (XDA on data tarriff)
How about 'entertaining'? As I understand it this is not allowable for corporation tax purposes, but it might save money because it reduces the amount paid to me as a dividend. So rather than receiving £50k dividend, around £18k of which is subject to higher rate tax, the company spends £250 on entertainment, and gives me £49,750, so I save paying higher rate tax on that £250 (which I would have spent instead myself).
As these more contentious items do not have tax relief for corporation tax, it seems that it's only useful to reduce my higher rate tax burden.
I can see that for many PSCs entertainment in reality is not a real business expense, because they don't really build relationships, but just apply for jobs via employment businesses. So obviously I don't want to take the piss, and put through every meal out with the wife (who is company secretary).
But at the same time if there's something that can be legitimately used to reduce tax (e.g., I understand that there's £150 for staff parties which can be spent without attracting a taxable benefit in kind), then I would like to do so.
So all suggestions on what you deduct and not have considered a benefit in kind would be welcome.
)
Comment