HMRC now accept 'smartphones' qualify as 'mobile phones'

[northernladuk]

Sorry to hog this thread, but, having pointed out the "business and private" guidance HRMC issued (above), my accountant has come back with:


A very small amount of personal use is permitted as one off case. However we normally recommend that you purely use the smartphone for business to avoid any future dispute with HMRC if investigated.
I replied:

"What constitutes a "very small amount"? I know that this is prudent, but it is not mentioned in the hrmc guidance at all?"

to which they replied:

HMRC has never defined or make clear what would constitute as small amount. It is normally left under discretion of the HMRC officer. This is why we never recommend personal use.

It just sounds he is being super careful to keep your ass covered for what is really peanuts. You are saving the tax on a £30 contract so it's hardly worth risking but I personally thing he is playing too safe..

If smartphones are now classed as mobile phones then this paragraph from the HMRC site wins IMO. Seems pretty clear to me and I would be happy claiming both and taking the risk.

You provide an employee with one mobile phone
Definitions or restrictions
You make one mobile phone (or SIM card) available for use to an employee. The phone can be used for both business and private calls. The contract is between you and the mobile phone operator.

The same rules apply whether you pay for rental charges, business calls and/or private calls.

What to report, what to pay
You have:

no reporting requirements
no tax or NICs to pay

[ronanm]

Thanks Northenladuk.

So Nixon William's interpretation is no good to me

[Clare@InTouch]

It just sounds he is being super careful to keep your ass covered for what is really peanuts. You are saving the tax on a £30 contract so it's hardly worth risking but I personally thing he is playing too safe..

If smartphones are now classed as mobile phones then this paragraph from the HMRC site wins IMO. Seems pretty clear to me and I would be happy claiming both and taking the risk.

Agreed. The other accountant may just be exceptionally cautious about this due to past experience, but I'd have no issue with it being claimed.

[Greg@CapitalCity]

It just sounds he is being super careful to keep your ass covered for what is really peanuts. You are saving the tax on a £30 contract so it's hardly worth risking but I personally thing he is playing too safe..

If smartphones are now classed as mobile phones then this paragraph from the HMRC site wins IMO. Seems pretty clear to me and I would be happy claiming both and taking the risk.

Agreed too. To be fair, there is no risk. The guidance is clear - you just have to meet the conditions already spelt out in this thread.

[ronanm]

Agreed too. To be fair, there is no risk. The guidance is clear - you just have to meet the conditions already spelt out in this thread.

I presume he's just following the interpretation of his firm so is only applying that. Accountants are cautious enough as it is (no offence guys and gals!) - trust me to pick the super cautious ones!

[Nixon Williams]

Thanks Northenladuk.

So Nixon William's interpretation is no good to me

I am happy for you to follow my advice and interpretation, I am not sure what accountant you are using but it does not surprise me. Many 'accountants' are very set in their ways and seem unable to interpret new information from HMRC.

HMRC are quite clear with their advice and guidance - at the end of the day you have to make the decision, but from what you have said on here, your accountant's advice is too cautious.

Alan

[Nixon Williams]

I presume he's just following the interpretation of his firm so is only applying that. Accountants are cautious enough as it is (no offence guys and gals!) - trust me to pick the super cautious ones!

I have no problem with being cautious if the guidance and rules are not clear - however that is not the case here. The rules are very clear, if you follow them, as outlined in my first post, you can claim for the use of a smartphone.

Alan

[FiveTimes]

Thanks for the clarification Alan, one final question what is the deal with MiFi type data only packages?

(for example MiFi on Three)

I have one of those, I bought it through the business. It doesn't differ from a usb modem stick.
I pay £15 / month for mobile broadband and I use it all the time on client site.

[Jeremiah@RHJAccountants]

I have no problem with being cautious if the guidance and rules are not clear - however that is not the case here. The rules are very clear, if you follow them, as outlined in my first post, you can claim for the use of a smartphone.

Alan

I agree with this and what the other accountants have said this rule is very clear so you can claim for the use of a smart phone.

[ronanm]

I have no problem with being cautious if the guidance and rules are not clear - however that is not the case here. The rules are very clear, if you follow them, as outlined in my first post, you can claim for the use of a smartphone.

Alan

I follow your interpretation, my accountant won't. He alludes to the "fact" that personal use is a "very small amount."

Further, my accountant said:

"HMRC has never defined or make clear what would constitute as small amount. It is normally left under discretion of the HMRC officer. This is why we never recommend personal use."

Looks like I'll have to sign-off the year end accounts despite the fact they do not comply with my interpretation of what is "true and fair."