WRONG WRONG WRONG WRONG!
I was using the same information, provided to me by my accountant, whilst in Norway for 3 years. Then had a tax investigation and the guy said. . . . common misconception this, then provided me with the following information:
For one man service companies the relevant guidance would be found in EIM30059 (EIM30059 - Dispensations: checking and authorisation of expenses payments) which states that for one man service companies as no one else is employed by the company who can check expenses reimbursed they must ensure:
- Expense is independently vouched (ie by accountant. "Vouched" requires the majority of expenditure to be receipted but does seem to have an allowance for small expenditure such as taxi fares)
- Expense is allowable as a deduction (wholly, exclusively and necessarily incurred - again would need proof of occurrence)
- Officer satisfied no additional tax is at risk.
Even when not a one-man service company regular checks are required for employers using these schemes - although employees don't need to keep receipts for HMRC they generally do need to keep them until checks by employer are carried out.
I was using the same information, provided to me by my accountant, whilst in Norway for 3 years. Then had a tax investigation and the guy said. . . . common misconception this, then provided me with the following information:
For one man service companies the relevant guidance would be found in EIM30059 (EIM30059 - Dispensations: checking and authorisation of expenses payments) which states that for one man service companies as no one else is employed by the company who can check expenses reimbursed they must ensure:
- Expense is independently vouched (ie by accountant. "Vouched" requires the majority of expenditure to be receipted but does seem to have an allowance for small expenditure such as taxi fares)
- Expense is allowable as a deduction (wholly, exclusively and necessarily incurred - again would need proof of occurrence)
- Officer satisfied no additional tax is at risk.
Even when not a one-man service company regular checks are required for employers using these schemes - although employees don't need to keep receipts for HMRC they generally do need to keep them until checks by employer are carried out.
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