Claim tax back for my laptop/ backup server/ Technet while Umbrella contracting?

[binladensgoat]

Has anyone who contracts via an Umbrella company claimed (successfully) for tax back for computer equipment (I have bought a laptop and a backup server) and a Technet subscription while being 'employed' by an Umbrella Company? I know self employed people can do this if they own their business, but I would like to do it too. My umbrella company offered to help me claim this by sending a letter authorising me to buy this for 'business needs' but want half the money for their trouble. Obviously, I would rather not give them such a big slice for what is very little effort for them.

Any advice gratefully received.

[ASB]

Why not just claim it as an expense on your tax return and get the tax back that way? In terms of the laptop check the capital allowance rates etc on the HMRC site and how you make the claim on your tax return.

HM Revenue & Customs: Tax relief for capital expenditure

[LisaContractorUmbrella]

Has anyone who contracts via an Umbrella company claimed (successfully) for tax back for computer equipment (I have bought a laptop and a backup server) and a Technet subscription while being 'employed' by an Umbrella Company? I know self employed people can do this if they own their business, but I would like to do it too. My umbrella company offered to help me claim this by sending a letter authorising me to buy this for 'business needs' but want half the money for their trouble. Obviously, I would rather not give them such a big slice for what is very little effort for them.

Any advice gratefully received.

Your umbrella company is acting completely unscrupulously! The cost can either be genuinely processed as an expense or it cannot and that depends on your circumstances. Why did you buy the laptop and server - was it required for your contract or did you buy because you thought it would be a useful purchase?

[NotAllThere]

What do you mean by "half the money". Half the tax saving? Half the total cost of the expenses?

With a technet subscription, that should be dealt with via the normal expensing route. For the hardware though, it's trickier. Even if the money comes out of your fee, the hardware belongs to the brolly. That means they've got an asset that they'll need to depreciate - i.e. additional account admin, which they may not be set up for.

Best go ltd. if you plan on buying more assets.

[binladensgoat]

Why not just claim it as an expense on your tax return and get the tax back that way? In terms of the laptop check the capital allowance rates etc on the HMRC site and how you make the claim on your tax return.

HM Revenue & Customs: Tax relief for capital expenditure

Thank-you for replying. Can I claim it back on my tax return even if I am not officially listed as 'self employed' by the tax office. Have you done this yourself?

Thanks

[binladensgoat]

Your umbrella company is acting completely unscrupulously! The cost can either be genuinely processed as an expense or it cannot and that depends on your circumstances. Why did you buy the laptop and server - was it required for your contract or did you buy because you thought it would be a useful purchase?

The latter. The server is for backing up my data and also practise for technology. The laptop is for everyday use

[binladensgoat]

What do you mean by "half the money". Half the tax saving? Half the total cost of the expenses?

With a technet subscription, that should be dealt with via the normal expensing route. For the hardware though, it's trickier. Even if the money comes out of your fee, the hardware belongs to the brolly. That means they've got an asset that they'll need to depreciate - i.e. additional account admin, which they may not be set up for.

Best go ltd. if you plan on buying more assets.

I am not planning on buying much more if at all in the short term. What is the 'normal expensing route' for Technet. I need that for me BTW, not particularly for my current contract which is only 3 months in any case. Thanks

[ASB]

Thank-you for replying. Can I claim it back on my tax return even if I am not officially listed as 'self employed' by the tax office. Have you done this yourself?

Thanks

Read the link. It relates to employees, you are one. It matters not a jot whether you are an employee of me, the local pub or your umbrella. The fact is that related expenses are claimable through your tax return. Of course you need to decide if the things you want to claim allowances on are genuinely claimable.

Is this laptop actually required to undertake the tasks for which you are paid? If, for example the end client provides said equipment then you might be struggling to legitimately be claiming for the laptop. Personal use is also a no no - but not entirely. If that use is merely incidental then you should be OK.

In terms of the backup server I am assuming you mean backup as in backup copy - i.e. a device to secure the contents of the laptop to.

It seems to me that if the laptop is claimable this should be. If the laptop is not claimable then it might still be; if the laptop would be claimable were it not for your personal use then the backup server should be OK.

The technet subscription. Why do you have it? It it necessary for the latest tools to be provided by you in order to undertake the services that you eventually bill the brolly for? Only you know the answer to that. If you just have the technet subscription to download things, have a bit of a play and generally keep upto date then no it would not be claimable. I'm not interested in any argument about that being unfair (I agree), but its the rules. Take that up with your MP

Remember of course that the tax man won't buy the items for you. He'll just in effect let you off the tax on them; but this situation would be exactly the same if you were expensing them through the brolly anyway. [Strictly all expenses received are simply income and charged to schedule D as such. You normally have a balancing entry which claims these costs against you total income].

If you cannot make up you own mind about the eligibility having looked on HMRC site and considered it in light of your own specific and unique situation then ring up the tax man and ask for an opinion.

As to your final question yes. Every year. I haven't actually claimed capital allowances in this way for some years, but I will always be claiming something (e.g. postage, paper for the printer, ink for the printer). The kind of stuff that my employer won't pay for because I choose to work from home. Nevertheless it is still a genuine employment expense.

[LisaContractorUmbrella]

The latter. The server is for backing up my data and also practise for technology. The laptop is for everyday use

Then I am afraid you would not be able to legitimately claim the expense through your umbrella company as it would be challenged by HMR&C under duality of purpose