HMRC audit going badly

[Clippy]

Thanks Lisa, clear as mud. Even simple things are complicated beyond all sense and reason it seems. No wonder folks get it wrong.

Ditto, thanks Lisa - I think.

[LisaContractorUmbrella]

Had a think about this and can give you an example which might help:

Contract start date: 1/11/2007 End Date: 2/2/2008 Location: London SO22 Duration 3 months
Contract start date: 4/4/2008 End Date 4/12/2009 Location: London SP5 Duration 20 months
Contract start date: 1/1/2010 End Date 1/01/2011 Location: central Birmingham Duration 12 months
Contract start date: 10/1/2011 End Date 30/6/2011 Location: London SP5 Duration 5 months

If you consider that the locations in London are not significantly different - the total duration of the contracts is 40 months and the total time spent in London is 28 months so the 24 months are exceeded and the London gig is 70% of the total time spent on contract which would invoke the 40% part of the 24 month rule

Not sure if that will make more sense or confuse things even further

[eek]

Had a think about this and can give you an example which might help:

Contract start date: 1/11/2007 End Date: 2/2/2008 Location: London SO22 Duration 3 months
Contract start date: 4/4/2008 End Date 4/12/2009 Location: London SP5 Duration 20 months
Contract start date: 1/1/2010 End Date 1/01/2011 Location: central Birmingham Duration 12 months
Contract start date: 10/1/2011 End Date 30/6/2011 Location: London SP5 Duration 5 months

So the rule is:-

For a totally new location if less than 24 months you are safe.

If its over 24 months stop claiming.

If you are returning to a previous location its a percentage game (note 40% of 24 months is 9.5 months roughly). This of course only applies once you've been contracting for 2 years or more.

If over the last 24 months you spent more than 9.5 months near that location don't claim.
If at the end of the newly signed contract it would be over 9.5 months don't claim.

I have to admit that rulebook is as clear as mud but thankfully I do like writing BDD documentation.

It does make returning to a previous client look quite awkward.

[LisaContractorUmbrella]

Yep pretty much Eek - makes the mind bogle doesn't it

[eek]

Yep pretty much Eek - makes the mind bogle doesn't it

It actually means that it is incredibly easy to be caught. If you spent 7 months in Stoke in the latter part of 2009 don't accept a three month contract there now.

[LisaContractorUmbrella]

It actually means that it is incredibly easy to be caught. If you spent 7 months in Stoke in the latter part of 2009 don't accept a three month contract there now.

Nope you'd be ok because your total time spent in Stoke doesn't exceed 24 months

[adubya]

How about....

Work as permie in the City for 12 months away from your "contracted" permie base so claim travel expenses, then jump ship and go contracting for a completely different end client but again in the city.

Does the "clock" start afresh when you transition from permie to contractor thus giving you potentially 24 months of expenses goodness or would the previous 12 months in permie land count ?

[Fred Bloggs]

Nope you'd be ok because your total time spent in Stoke doesn't exceed 24 months

But........... it would be 40% of 24 months so you're caught?

Must admit, To now, I have thought that I have always been compliant with the 24 month rule but this discussion is beginning to sow seeds of doubt in my mind now.

[LisaContractorUmbrella]

But........... it would be 40% of 24 months so you're caught?

Must admit, To now, I have thought that I have always been compliant with the 24 month rule but this discussion is beginning to sow seeds of doubt in my mind now.

What are your circumstances Fred? It's often a lot easier to explain this rule if you can work with an example - pm me if you prefer

[Fred Bloggs]

What are your circumstances Fred? It's often a lot easier to explain this rule if you can work with an example - pm me if you prefer

Much appreciated. I think I'm OK, but if I want a second opinion I'll PM you. Thanks again.