Expenses - I don't believe this

[northernladuk]

What is so hard about posting umbrella questions in the Umbrella section this week?

[jmo21]

I should have stated that I am contracted to a well known outsourcing company based in London and I work from home getting my assignments or temporary workplaces via email. This week was Aberdeen, Leeds, Kilnarnock and Milton Keynes. Should I not be able to claim travel and accommodation which is a subsatntial part of my income then the contract effectively becomes non viable from a financial point of view.

Is it usual in your line to pay for these types of expenses yourself, or did you negotiate a higher than normal rate to cover it?

[gingerjedi]

What they say in EIM32125 is that if you work at a single work place for more than 80% of the entire duration of your employment then you are not entitled to claim travelling expenses to that workplace at all (even within the 24 months/40% rule). In your situation it appears that you don't work at a single work place and I think the umbrella have incorrectly applied the rules here.

News to me!

I've been at the same place for 19 months now claiming over £1k a month.

I take it this 'rule' is aimed at agency and fixed term only??

[Epiphone]

I'd also be telling the brolly to NEVER, EVER amend the invoice without speaking to me first.

[Wanderer]

News to me!

I've been at the same place for 19 months now claiming over £1k a month.

Have a read of EIM32125 then. My understanding is that it only catches you if this is the ONLY contract you reasonably expect to do while employed by your LTD/Umbrella company.

If you expect to work on other engagements (which you do, of course ) then you are OK.

You will find that most umbrellas ask contractors if this is the only engagement they intend to work on and if it is then they won't allow most travel/subsistence claims. Of course, most people genuinely expect that they will work on multiple assignments via the LTD/Umbrella so that makes it OK.

The thing I don't agree with here is what happened with abbeyit's umbrella where they retrospectively disallowed the claims. As with the 24 month rule, my reading EIM3125 is that they shouldn't disallow the claims so long as there was a genuine intention to take multiple engagements at the outset (and how could they ever prove otherwise).

[abbeyit]

Is it usual in your line to pay for these types of expenses yourself, or did you negotiate a higher than normal rate to cover it?

Rate offered was a little higher than normal but was quoted as "all in" and I calculated that it would still be worth it in the long run.

[abbeyit]

I'd also be telling the brolly to NEVER, EVER amend the invoice without speaking to me first.

Thanks. One of the reasons I chose not to stay with the umbrella company and start my own LTD. Now need to decide whether to register for VAT or not.

[scope]

Thanks. One of the reasons I chose not to stay with the umbrella company and start my own LTD. Now need to decide whether to register for VAT or not.

I think thats a no brainer unless your expenses are of such a nature that you would be better off claiming VAT on them.. You charge your client 20% and only pass on 13-14% to the VAT man - the rest is yours to keep.

[SueEllen]

The thing I don't agree with here is what happened with abbeyit's umbrella where they retrospectively disallowed the claims. As with the 24 month rule, my reading EIM3125 is that they shouldn't disallow the claims so long as there was a genuine intention to take multiple engagements at the outset (and how could they ever prove otherwise).

They are doing it retrospectively mainly because HMRC have been enquiring into a few umbrellas' expense practises in the last few years, and as it's probably not 9 months after their company year end they can adjust their accounts any time they feel like.

[LisaContractorUmbrella]

I think thats a no brainer unless your expenses are of such a nature that you would be better off claiming VAT on them.. You charge your client 20% and only pass on 13-14% to the VAT man - the rest is yours to keep.

A slightly more detailed explanation may have been helpful here - if you register for VAT have a chat with your accountant and make sure you understand the ins and outs before hand