HMRC audit going badly

[SueEllen]

I understand where you are coming from but when accountancy rules require lawyers to understand their complexity and grey areas it does become unworkable to the accountancy profession without further expense of using lawyers. All an accountant can do is highlight the law to you, they cannot for each individual company implement the law and that has to be the job of the Directors to ensure they comply with the 24 month or any other rule.

IMHO the correct people to vent any anger at is HMRC, your MP etc as effectively this rule is denying people the right to work. I have seen in this thread someone from Bournemouth, and another from Devon who are effectively being denied the right to work (or having to pay higher tax) because they live in an area where their skills are not required and most/all their work has been confined to one square mile of London.

WHS

When you are talking to a mate who is currently trying to set up a company and you are finding that accountants in her specialist area are as useful in answering questions as cheaper accountants who aren't in the specialist area, you realise that some people are just very good at advertising.

[SueEllen]

Contractor Accountants should know better, there is not much to a set of contractors accounts, travel rules and reviewing the 24 month rule (outside IR35) must be the biggest thing to review IMHO.

You are presuming that every contractor is exactly the same.

There are people with multiple contracts, people with employees, people with subcontractors, people who travel all over the place etc.

Note the director needs advice from the accountant, to be tax efficient and know they are doing things in proper manner.

Which is what the accountant's job is.

Bookkeeper wouldn't know much about the 24 month rule.

You would be surprised what people do and don't know, and shouldn't write someone off just due to a job title or the amount of training they have had.

It's very easy to find people who run companies in IT or out of it who claim to have been screwed or given the wrong advice by an accountant but only realised it when someone else has pointed out that they should really look into it.

[SueEllen]

Depends what one has agreed. If you ask them only to do end of year accounts and pay accordingly fair enough but I'd geuss most contractors pay for a full service including advice on both their company affairs and personal tax returns. The ads sell you on all the expertise etc but if advice is only given in response to a specific question it's of little use, if you knew what questions to ask you could find the answers yourself anyway. Why would a total newbie even know length of time at a contract site was an issue anyway?

Is it really so much to suggest that new clients should be given a few pages of written guidance on the essential basics - use of bank accounts, keeping records, their reporting duties, how to deal with invoices, what sort of things you can claim etc etc? Few do in my experience.

Maybe we should have a condensed guide on the CUK First Timers link.

There are accountancy firms like SJD, organisations like the PCG and business link who do produce guides.

However when you talk to another contractor who you know has been with an accountant who produces a guide but they haven't read it, you realise people will blame others whether they get the information or not.

[IR35 Avoider]

IMHO the correct people to vent any anger at is HMRC, your MP etc as effectively this rule is denying people the right to work. I have seen in this thread someone from Bournemouth, and another from Devon who are effectively being denied the right to work (or having to pay higher tax) because they live in an area where their skills are not required and most/all their work has been confined to one square mile of London.

Just jumping into the thread without reading all that preceded this, so I may misunderstanding you. Are you saying people can't work because they can't get tax relief on expensive commuting costs that result from them living very far from where work is?

That's all backwards. Firstly, no-one is supposed to be claiming commuting expenses on an ongoing basis. In theory it is something to be claimed temporarily in special circumstances. (If the letter of the law allows some contractors to claim it more often than not, then lucky them, but I doubt that's what politicians envisaged when they framed the laws.) The general principle is that people are supposed to pay commuting costs out of taxed income. Secondly, if people want to work, it's their responsibility to live within commuting distance of where the work is. I certainly wouldn't vote for someone to receive a public subsidy (which is what tax relief would be) for living further away.

[SueEllen]

Just jumping into the thread without reading all that preceded this, so I may misunderstanding you. Are you saying people can't work because they can't get tax relief on expensive commuting costs that result from them living very far from where work is?

That's all backwards. Firstly, no-one is supposed to be claiming commuting expenses on an ongoing basis. In theory it is something to be claimed temporarily in special circumstances. (If the letter of the law allows some contractors to claim it more often than not, then lucky them, but I doubt that's what politicians envisaged when they framed the laws.) The general principle is that people are supposed to pay commuting costs out of taxed income. Secondly, if people want to work, it's their responsibility to live within commuting distance of where the work is. I certainly wouldn't vote for someone to receive a public subsidy (which is what tax relief would be) for living further away.

Some countries actually do have a subsidy to ensure people can pay their commuting costs to work out of untaxed income however they get taxed on other things.

This prevents people from having an excuse that they can't work if there is no work where they live or they can't afford the cost of commuting, which is a massive problem in England as not everyone regardless of income level can live in London and the South East where most of the jobs are.

[LisaContractorUmbrella]

That is a poor comment IMHO... and a very bad slight on Accountants !

Wonder what the accountant bods on here think of that comment !?!

No it is a perfectly reasonably comment - you are responsible for your own limited company; your accountant can advise you about tax law and the rules that govern your business so that you know what to look out for but you cannot expect them to monitor each and every contract, compare it to previous contracts, establish travelling distances and times and then tell you whether or not you are or are likely to be over the 24 month rule. Also bear in mind that this situation has to be monitored on a regular basis for contract extensions or early terminations.

[TeeDeeEye]

Canary Wharf vs Broadgate

Do you think the 24m rule would apply if going from a contract in Broadgate to one in Canary Wharf?

[Fred Bloggs]

Do you think the 24m rule would apply if going from a contract in Broadgate to one in Canary Wharf?

It also depends where you set out from. Setting out from say, Manchester, I think you'd be caught because the overall journey isn't significantly different. IMO, of course.

[TeeDeeEye]

It also depends where you set out from. Setting out from say, Manchester, I think you'd be caught because the overall journey isn't significantly different. IMO, of course.

It would be from Cambridgeshire, but the journey time would increase by about 25mins and they are a few miles apart.

[eek]

It would be from Cambridgeshire, but the journey time would increase by about 25mins and they are a few miles apart.

I think the vast majority of the journey would be the same as surely you would be on the same train to liverpool street / kings cross.