Accommodation Rental

[pmeswani]

Is someone able to tell me whether my take home profit would be less or more for each circumstance above? i.e take home pay by taking the flat and take home pay by taking the house share?

I think you can work that out for yourself. Here is a simple formula for legitimate business expenses factored in.


(Monthly Business Income - Legitimate Business Expense) *.80 will give you Take Home Pay + Legitimate Business Expense.

If your expense is not legitimate, then the following formular will apply.

Monthly Business Income * 0.80 = Monthly Take Home Pay.

(Monthly Take Home Pay = Salary + Dividends).

If you work it out for yourself, you will find that if your rent is a legitimate expense, then your take home pay will be higher.

But as we don't know if you are inside or outside IR35, we cannot be certain if you are better off. If you are inside IR35, you may not be entitled to claim the full amount for rent. If you are outside IR35, you should be ok, as long as you are able to take the right amount for Salary and the right amount for Dividends.

We won't work out how to do the maths for you, but I am sure with the information provided above, you will be able to work it out yourself.

[bystander]

Can primary property be in another country ?

Hello,

I was told by my umbrella company that I can claim for accommodation as long as I am maintaining a property elsewhere.

Now in my case, I am new in the UK and this is my first contract and I own a property back in my home country which I purchased with the help of a bank loan. I will continue to pay my monthly instalments to the bank and also the property is in my name and so are the utility bills.

My umbrella company is telling me that I can claim for my rental accommodation here in the UK as long as I can prove that I am maintaining (own or rent) a property in my home country, such as a sale deed or utility bills which are in my name in this case.

Now my question is, is this really the case ? Has anybody done this before ?

Your advice in this regard is much appreciated.

Regards,
OR.

[Scrag Meister]

When I first moved up to London I rented a room in a house share and paid the entire rent each month from my company, my main home was in Devon, the landlord provided a receipt each month which went to my accountants.

This however only lasted for the first 2 years of my first contract, due to the 2 year expenses rule.

[SueEllen]

Hello,

I was told by my umbrella company that I can claim for accommodation as long as I am maintaining a property elsewhere.

Now in my case, I am new in the UK and this is my first contract and I own a property back in my home country which I purchased with the help of a bank loan. I will continue to pay my monthly instalments to the bank and also the property is in my name and so are the utility bills.

My umbrella company is telling me that I can claim for my rental accommodation here in the UK as long as I can prove that I am maintaining (own or rent) a property in my home country, such as a sale deed or utility bills which are in my name in this case.

Now my question is, is this really the case ? Has anybody done this before ?

Your advice in this regard is much appreciated.

Regards,
OR.

As your English is fluent the best source to confirm the umbrella company's understanding is actually the HMRC site.

For starters have a look at this:
http://www.hmrc.gov.uk/guidance/480.pdf

Then search via google for any other documents it points you to as unfortunately the UK tax system is really complicated and it relies on finding the relevant documents, reading them and asking questions.

[northernladuk]

Hello,

I was told by my umbrella company that I can claim for accommodation as long as I am maintaining a property elsewhere.

Now in my case, I am new in the UK and this is my first contract and I own a property back in my home country which I purchased with the help of a bank loan. I will continue to pay my monthly instalments to the bank and also the property is in my name and so are the utility bills.

My umbrella company is telling me that I can claim for my rental accommodation here in the UK as long as I can prove that I am maintaining (own or rent) a property in my home country, such as a sale deed or utility bills which are in my name in this case.

Now my question is, is this really the case ? Has anybody done this before ?

Your advice in this regard is much appreciated.

Regards,
OR.

I don't think it is as black and white as that. It depends on your situation over here. Are you here for a long stint so it can be argued the place here is now your home from home because you are going to be here for a long stint or are you renting for a 6 month contract.

One is obviously taking the piss, just because you have a home else where doesn't mean this is your temp one, the other is a valid expense.

[eek]

Hello,

I was told by my umbrella company that I can claim for accommodation as long as I am maintaining a property elsewhere.

Now in my case, I am new in the UK and this is my first contract and I own a property back in my home country which I purchased with the help of a bank loan. I will continue to pay my monthly instalments to the bank and also the property is in my name and so are the utility bills.

My umbrella company is telling me that I can claim for my rental accommodation here in the UK as long as I can prove that I am maintaining (own or rent) a property in my home country, such as a sale deed or utility bills which are in my name in this case.

Now my question is, is this really the case ? Has anybody done this before ?

Your advice in this regard is much appreciated.

Regards,
OR.

The test the inland revenue will use is a simple one:-

Do you use the rental property outside the working week. If the answer to that question is Yes they will argue over the expense claim.

[LisaContractorUmbrella]

NorthernLad is right, it is more complicated than that - it will depend on the circumstances under which you are working in the UK, how long the contract is, whether you have rented out your property at home etc etc. Your umbrella company should be asking for quite detailed information before advising that the expense is allowable.

[dav]

I was hoping to avoid all kinds of accountants and do everything myself but it just looks like a total minefield.

[LisaContractorUmbrella]

I was hoping to avoid all kinds of accountants and do everything myself but it just looks like a total minefield.

There is a lot to think about if you are new to contracting but a decent umbrella company or accountant will be able to explain things to you; once you have a grasp of it all you will be in a position to take on more yourself

Good luck