HMRC audit going badly

[Gonzo]

I don't like to stick a fly in the ointment, but ...

I have seen the example that the OP links to on the HMRC site before, with one caveat -

In their example they are saying that none of the workplaces can be considered as temporary workplaces, which would mean that travel expenses could not be claimed at all.

I hadn't noticed that part before and it is subtly different to the collective understanding that we have all arrived at, which was you can claim until you know you will be there for more than 24 months at which point it then ceases to be a temporary workplace and you stop claiming.

Or am I missing something?

[configman]

Or am I missing something?

Most likely HMRC are missing something, they have never understood their own rules and always jump in feet first. This could be OP's first chance to unbalance HMRC with superior knowledge.

[northernladuk]

Most likely HMRC are missing something, they have never understood their own rules and always jump in feet first. This could be OP's first chance to unbalance HMRC with superior knowledge.

From what I understand the rule was never meant for us which is why it is so difficult to understand. It was more for permies that were relocating acorss the country. The idea was two years was considered a reasonable length of time for someone to settle in a job and relocate.

[xoggoth]

This is in Booklet 490

Temporary workplace – attendance for a limited duration or temporary purpose
3.11 A place is a temporary workplace if an employee goes there only to perform a task of
limited duration or for a temporary purpose. So even where an employee attends a
workplace regularly, it will be a temporary workplace and, therefore, not a permanent
workplace if the employee attends for the purpose of performing a task of limited
duration or other temporary purpose.

Limited duration – the 24 month rule

3.12 As explained in paragraph 3.11, a place which an employee attends for the purpose
of performing a task of limited duration or for some other temporary purpose is a
temporary workplace. But there is a special rule which prevents a workplace being a
temporary workplace where an employee attends it in the course of a period of
continuous work which lasts, or is likely to last, more than 24 months

[xoggoth]

Bit off topic but this case suggests once again that nobody should think that because they have an accountant there will not be a problem. Unless you ask many tell you nothing. Always check out tax rules yourself and know enough about accounts to make sure they are reasonably accurate.

[prozak]

Can't see HMRC losing this one.

[LisaContractorUmbrella]

Here's some more stuff from HMR&C website about temporary workplace and travel expenses:


EIM32000 - Travel expenses: travel for necessary attendance: table of contents
Introduction
EIM32005 Introduction: how the temporary workplace rules interact
EIM32011 Introduction: simple examples
EIM32015 Introduction: when are travel expenses deductible?
EIM32030 Introduction: travel between employments
EIM32031 Introduction: travel between employments: example
EIM32035 Introduction: travel between separate employers within a group
EIM32036 Introduction: travel between separate employers within a group: examples
EIM32040 Introduction: joint projects
EIM32041 Introduction: joint projects: example
Definitions
EIM32050 Definitions: introduction
EIM32055 Definitions: ordinary commuting
EIM32056 Definitions: ordinary commuting: example
EIM32060 Definitions: ordinary commuting: necessary journeys
EIM32065 Definitions: permanent workplace
EIM32070 Definitions: permanent workplace: regular attendance
EIM32075 Definitions: temporary workplace
EIM32080 Definitions: temporary workplace: limited duration: the 24 month rule
EIM32081 Definitions: temporary workplace: example
EIM32082 Definitions: temporary workplace: example
EIM32083 Definitions: temporary workplace: example
EIM32084 Definitions: temporary workplace: example
EIM32085 Definitions: temporary workplace: example
EIM32086 Definitions: temporary workplace: example
EIM32087 Definitions: temporary workplace: example
EIM32088 Definitions: temporary workplace: example
EIM32089 Definitions: temporary workplace: example
EIM32090 Definitions: temporary workplace: example
EIM32091 Definitions: temporary workplace: example
EIM32092 Definitions: temporary workplace: example
The 24 month rule
EIM32100 The 24 month rule: how to find out the expected period of time at a workplace
EIM32101 The 24 month rule: how to find out the expected period of time at a workplace: example
EIM32105 The 24 month rule: breaks in attendance
EIM32106 The 24 month rule: breaks in attendance: example
EIM32107 The 24 month rule: breaks in attendance: example
EIM32108 The 24 month rule: breaks in attendance: example
Fixed term appointments and agency workers
EIM32125 Fixed term appointments and agency workers: fixed term appointments
EIM32126 Fixed term appointments and agency workers: fixed term appointments: example
EIM32127 Fixed term appointments and agency workers: fixed term appointments: example
EIM32128 Fixed term appointments and agency workers: fixed term appointments: example
EIM32129 Fixed term appointments and agency workers: fixed term appointments: example
EIM32130 Fixed term appointments and agency workers: agency workers
EIM32131 Fixed term appointments and agency workers: agency workers: example
EIM32132 Fixed term appointments and agency workers: fixed term appointments: site-based workers
EIM32133 Fixed term appointments and agency workers: fixed term appointments: site-based workers: likely to hold
EIM32134 Fixed term appointments and agency workers: fixed term appointments: site-based workers: reasonable to assume
EIM32135 Personal service companies
EIM32136 Personal service companies: example
EIM32137 Fixed term appointments and agency workers: case law
More than one permanent workplace at the same time
EIM32140 More than one permanent workplace at the same time
EIM32141 More than one permanent workplace at the same time: example
EIM32142 More than one permanent workplace at the same time: example
Attendance for a temporary purpose
EIM32150 Attendance for a temporary purpose
EIM32151 Attendance for a temporary purpose: example
EIM32152 Attendance for a temporary purpose: example
EIM32153 Attendance for a temporary purpose: example
EIM32154 Attendance for a temporary purpose: example
Depots and similar bases
EIM32160 Depots and similar bases
EIM32161 Depots and similar bases: example
EIM32162 Depots and similar bases: example
EIM32163 Depots and similar bases: example
EIM32164 Depots and similar bases: example
Employees who work at home
EIM32170 Employees who work at home
EIM32171 Employees who work at home: example
EIM32172 Employees who work at home: example
EIM32173 Employees who work at home: example
Private travel
EIM32180 Private travel
EIM32181 Private travel: example
EIM32182 Private travel: example
Duties defined by reference to a particular area
EIM32190 Duties defined by reference to a particular area
EIM32191 Duties defined by reference to a particular area: meaning of "defined by reference to an area"
EIM32195 Duties defined by reference to a particular area: some duties outside the area
EIM32200 Duties defined by reference to a particular area: deductions for travel
EIM32201 Duties defined by reference to a particular area: example
EIM32202 Duties defined by reference to a particular area: example
EIM32203 Duties defined by reference to a particular area: example
EIM32204 Duties defined by reference to a particular area: example
EIM32205 Duties defined by reference to a particular area: example
EIM32206 Duties defined by reference to a particular area: example
EIM32207 Duties defined by reference to a particular area: example
When a workplace ceases to be a permanent workplace
EIM32220 When a workplace ceases to be a permanent workplace
EIM32221 When a workplace ceases to be a permanent workplace: example
Passing work on the way to somewhere else
EIM32230 Passing work on the way to somewhere else
EIM32231 Passing work on the way to somewhere else: example
Emergency call-out and stand-by
EIM32240 Emergency call-out and stand-by: emergency call-out
EIM32241 Emergency call-out and stand-by: emergency call-out: example
EIM32250 Emergency call-out and stand-by: stand-by
EIM32251 Emergency call-out and stand-by: stand-by: example
Safeguards against abuse
EIM32260 Safeguards against abuse: introduction
Safeguards against abuse: the necessary attendance rule
EIM32270 Safeguards against abuse: the necessary attendance rule
EIM32271 Safeguards against abuse: the necessary attendance rule: example
EIM32272 Safeguards against abuse: the necessary attendance rule: example
Safeguards against abuse: changes to a workplace
EIM32280 Safeguards against abuse: changes to a workplace
EIM32281 Safeguards against abuse: changes to a workplace: example
EIM32282 Safeguards against abuse: changes to a workplace: example
EIM32283 Safeguards against abuse: changes to a workplace: example
EIM32285 Safeguards against abuse: changes to a workplace: a change in the journey with no change in cost
EIM32286 Safeguards against abuse: changes to a workplace: a change in the journey with no change in cost: example
Safeguards against abuse: journeys treated as ordinary commuting
EIM32300 Safeguards against abuse: journeys treated as ordinary commuting
EIM32301 Safeguards against abuse: journeys treated as ordinary commuting: example
EIM32302 Safeguards against abuse: journeys treated as ordinary commuting: example
EIM32303 Safeguards against abuse: journeys treated as ordinary commuting: example
EIM32304 Safeguards against abuse: journeys treated as ordinary commuting: example
EIM32305 Safeguards against abuse: journeys treated as ordinary commuting: example
EIM32306 Safeguards against abuse: journeys treated as ordinary commuting: example
EIM32307 Safeguards against abuse: journeys treated as ordinary commuting: example
EIM32308 Safeguards against abuse: journeys treated as ordinary commuting: example
EIM32309 Safeguards against abuse: journeys treated as ordinary commuting: example
EIM32310 Safeguards against abuse: journeys treated as ordinary commuting: example
Safeguards against abuse: journeys treated as private travel
EIM32320 Safeguards against abuse: journeys treated as private travel
EIM32321 Safeguards against abuse: journeys treated as private travel: example
EIM32322 Safeguards against abuse: journeys treated as private travel: example
EIM32323 Safeguards against abuse: journeys treated as private travel: example
EIM32324 Safeguards against abuse: journeys treated as private travel: example
EIM32325 Safeguards against abuse: journeys treated as private travel: example

Hence the confusion

[Fred Bloggs]

Bit off topic but this case suggests once again that nobody should think that because they have an accountant there will not be a problem. Unless you ask many tell you nothing. Always check out tax rules yourself and know enough about accounts to make sure they are reasonably accurate.

Totally agree. I have never had a single question asked by the accountant regarding anything I have ever done in my Ltd Co. Whether they should have or not is another question. I doubt HMRC would put much weight in this as mitigation on the contractor's part.

[helen7]

It's quite simple really.

If you work as a permie for 2 years in London office and they tell you you have to work in Manchester for 6 months, it is quite reasonable for them to pay your train fare. If they move you for longer that 2 years, it is quite reasonable to expect that is now your perminent place of work.

If they moved you from the London office to an office 2 or 3 miles away, would you expect them to pay for all of your travel from home? No!

The same applies to your LTD company.

[Emigre]

Here's some more stuff from HMR&C website about temporary workplace and travel expenses:


EIM32000 - Travel expenses: travel for necessary attendance: table of contents
Introduction
EIM32005 Introduction: how the temporary workplace rules interact
.
.
.
EIM32323 Safeguards against abuse: journeys treated as private travel: example
EIM32324 Safeguards against abuse: journeys treated as private travel: example
EIM32325 Safeguards against abuse: journeys treated as private travel: example

Hence the confusion

Excellent stuff Lisa. I now feel all knowing. Once again and already said so many times, its wrong in principle anyway. If you are in business on your own account you should be able to claim expenses against the revenue brought into that business. I work in the City and earn significantly more than I would if I worked outside. It costs me more to get there. HMRC is still the net winner. If its ok for every day of 24 months what is wrong with month 25 and after.

It is of course possible to move your registered office every 2 years...what happens then?