2 year rule

[Scrag Meister]

At what point would this become an issue?

I have a fellow contractor at Current ClientCo and he has been claiming expenses for years, not all at the same ClientCo but in an around London.

When does a new 2 year period start?

I haven't claimed any subsistence (lunches, travel etc..) type expenses since May 2009 when my first 2 years was up at my previous ClientCo.

In November 2009 I actually bought a house in London.

In May 2010 this year I moved to New ClientCo, should I have been able to start claiming expenses again? And what does it depend on.

Have read a lot of

2 Year thread collection

but nothing is really that clear.

[northernladuk]

It is very wooly as no one seems to know what kind of geography this covers. Some people think it re-sets (or starts again) everytime you start a new role anywhere, some think that if you have a role in Stockport and another 7 miles away in Manchester it starts again, other think it will only start again if you move considerable distance i.e. Manchester to Liverpool.

It starts as soon as you start claiming in a new region (caveats above) and ends in 2 years after which you claim nothing. How you define how the clock re-starts is up to you. The idea is that the government will sub you while you re-locate for a reasonable length of time after which they expect you to move to that region. I would say a 7 mile difference in location is still in the same region so you would still be expected to relocate there so the clock would continue but it is up to your level of risk if you get caught I guess.

Does that answer you question (with my opinions of course)?

[LisaContractorUmbrella]

There is really no start and finish date, the 24 months are, to all intents and purposes, rolling. The rules are quite complicated and also open to interpretation, to a degree, so you do need to be careful. In your situation it would really depend on the location of the new contract; a change in location but no significant change in distance travelled or time spent travelling will mean that you could fall foul of the 24 month rule. Unfortunately HMR&C do not clarify 'significant' so you have to make a judgement call. If you travelled 10 miles to the original contract and it took you 20 minutes to get there and your new contract is 12 miles away and it still takes you 20 minutes to get there you will fall under 24 month rule.

Malvolio gave a really good explanation of the entire rules (I think it was Mal anyway) - a search on here should turn it up for you

[Wanderer]

At what point would this become an issue?

Sounds like it's a value judgement so ask your accountant and do what they say. When/if HMRC ever come knocking, say "I am not an accountant and don't understand the complex rules so I took professional advice and that's what I was told to do". I don't see how you could be penalised for it, considering that you demonstrated reasonable diligence.

[malvolio]

Malvolio gave a really good explanation of the entire rules (I think it was Mal anyway) - a search on here should turn it up for you

Do you mean this one - Malvolios Blog » What

[SueEllen]

Do you mean this one - Malvolios Blog » What

Yes.

However I read your entry and thought that this could easily get confused in London due to the travelcard zones, and the fact that the time/distance between a station in a different zone is not necessarily that big.

[LisaContractorUmbrella]

Do you mean this one - Malvolios Blog » What

Hi Mal Yep that's the one

[malvolio]

Yes.

However I read your entry and thought that this could easily get confused in London due to the travelcard zones, and the fact that the time/distance between a station in a different zone is not necessarily that big.

Like I said, it's not clear. The phrase is "Substantially the same". Go to the Square Mile, it's all the same as far as Hector is concerned. Move from the Square Mile to Waterloo, you may have a case, even though you're only one stop on the Drain.

Hey, if it was simple, I'd be out of a job...