24 month rule - different ends of London

[Old Greg]

Yes. This is probably the closest example to your situation that I can find in HMR&C's manuals

EIM32282 - Travel expenses: travel for necessary attendance: safeguards against abuse: changes to a workplace: example
An employee works for an employer who has several offices close to each other in London. Her employer rotates staff around the offices every 18 months. She works at one office and is then moved to another. She travels to work on the Underground and, although she now gets off ten stops further on than previously, her journey is largely unaltered and the price of her ticket does not change.

The new office is not recognised as a new workplace because the change of site has no substantial effect on her journey to work, see EIM32280. Although her attendance at the new office is expected to be for a limited duration it will not be a temporary workplace. Her expected attendance at the single workplace represented by the two offices will be in a period of continuous work that is expected to exceed 24 months, see EIM32080. The new office is a permanent workplace and she cannot deduct the cost of travel between her home and the new office.

Thanks again Lisa. Input from the pros appreciated!

The thing is my ticket will now be a good bit cheaper and I will no longer have mileage and parking costs.

[LisaContractorUmbrella]

Thanks again Lisa. Input from the pros appreciated!

The thing is my ticket will now be a good bit cheaper and I will no longer have mileage and parking costs.

Anytime I am not really sure how much weight that would carry if the journey time and distance were pretty much identical that's the problem and I am assuming with 100 mile journeys we are talking about a fairly high amount of expenses?

[Old Greg]

Anytime I am not really sure how much weight that would carry if the journey time and distance were pretty much identical that's the problem and I am assuming with 100 mile journeys we are talking about a fairly high amount of expenses?

The cost my current way is £830 + £100 parking + 250 miles per month
The cost the new way is £690 per month

A substantial difference, and partly why I have only been going the expensive route is because the route doesn't make sense for North London.

So to rephrase

although she now gets off ten stops further on than previously, her journey is largely unaltered and the price of her ticket does not change.

I think I am now

although I now end up only six miles away from before, my journey is completely different and the price of both the ticket and journey does change.

It is a bit of a pickle. Because the other view is - look, you've been commuting to London for two years and you're still commuting to London so stop claiming. I genuinely don't know what to do.

[TheFaQQer]

Yes. This is probably the closest example to your situation that I can find in HMR&C's manuals

EIM32282 - Travel expenses: travel for necessary attendance: safeguards against abuse: changes to a workplace: example
An employee works for an employer who has several offices close to each other in London. Her employer rotates staff around the offices every 18 months. She works at one office and is then moved to another. She travels to work on the Underground and, although she now gets off ten stops further on than previously, her journey is largely unaltered and the price of her ticket does not change.

The new office is not recognised as a new workplace because the change of site has no substantial effect on her journey to work, see EIM32280. Although her attendance at the new office is expected to be for a limited duration it will not be a temporary workplace. Her expected attendance at the single workplace represented by the two offices will be in a period of continuous work that is expected to exceed 24 months, see EIM32080. The new office is a permanent workplace and she cannot deduct the cost of travel between her home and the new office.

I think that the key words in the HMRC guidance are "her journey is largely unaltered". In the example, that is true; in OG's case, I think that is false.

If it were me, I'd be claiming it and be prepared to argue the case.

[Craig at Nixon Williams]

I agree with Lisa on this.

Neither the cost of the journey or the mode of transport would be a factor in deciding whether you would be caught by this or not. If you are commuting 100 miles to get into London and the workplaces are only 6 miles apart then I’d expect HMRC to view this as being substantially the same journey.

It is a bit of a pickle. Because the other view is - look, you've been commuting to London for two years and you're still commuting to London so stop claiming. I genuinely don't know what to do.

I think what you have said there hits the nail on the head...

Hope this helps!
Craig

[Old Greg]

I agree with Lisa on this.

Neither the cost of the journey or the mode of transport would be a factor in deciding whether you would be caught by this or not. If you are commuting 100 miles to get into London and the workplaces are only 6 miles apart then I’d expect HMRC to view this as being substantially the same journey.



I think what you have said there hits the nail on the head...

Hope this helps!
Craig

Thanks very much for the input Craig. Where I am struggling is, why (rhetorical question) would they give the example of:

although she now gets off ten stops further on than previously, her journey is largely unaltered and the price of her ticket does not change

and expect that to apply when my journey is entirely different and the price is different. It seems to me there are three factors in their example:

- destination (six miles apart)
- journey (entirely different)
- ticket price (different)

I think I'm just going to have to make a judgement call on what to do...

Other factors to consider are:

- HMRC may take whatever view they wish but that doesn't make it correct.
- However, I don't particularly want to have to fight it even if I'm going to win.
- I don't want the hassle of being opened up to other investigations after drawing their attention.
-

[TheFaQQer]

Other factors to consider are:

- HMRC may take whatever view they wish but that doesn't make it correct.
- However, I don't particularly want to have to fight it even if I'm going to win.
- I don't want the hassle of being opened up to other investigations after drawing their attention.
-

For them to find this, then you are already going to be going through an expenses investigation. That may prove to be a fight, or it may not be.

You can easily point out the examples from their website seem to indicate that if the journey is different, then it's a claimable expense. If they find in their favour, then since you've not been aiming to defraud (you've obviously given a lot of thought to the matter), then you'd have to pay back the tax due on it being a BIK instead of an expense.

If I were in your position, then I would document the situation clearly, comparing it with examples from HMRC. Make sure you file that away somewhere safe, so that if there was an investigation and they said "what makes you think that was allowed?" then you immediately have the response to hand, without having to think on the spot. After that, claim the expenses. Generally, I'm risk averse, but in this case I'd be prepared to argue my case and accept that I may be wrong.

Of course, you could just go permie - maybe you're not cut out for contracting

[Old Greg]

For them to find this, then you are already going to be going through an expenses investigation. That may prove to be a fight, or it may not be.

You can easily point out the examples from their website seem to indicate that if the journey is different, then it's a claimable expense. If they find in their favour, then since you've not been aiming to defraud (you've obviously given a lot of thought to the matter), then you'd have to pay back the tax due on it being a BIK instead of an expense.

If I were in your position, then I would document the situation clearly, comparing it with examples from HMRC. Make sure you file that away somewhere safe, so that if there was an investigation and they said "what makes you think that was allowed?" then you immediately have the response to hand, without having to think on the spot. After that, claim the expenses. Generally, I'm risk averse, but in this case I'd be prepared to argue my case and accept that I may be wrong.

Of course, you could just go permie - maybe you're not cut out for contracting

As it happens, I'm planning to go permie. This is my back up plan.

Anyway, cheers, mate. This is my inclination. But, interesting that the pros disagree, and I expect my own accountant to disagree, probably out of risk aversion. In truth I reckon I'm in a grey area. So, as always, I should take their advice seriously, and then come to my own decision.

One more example and it is based very much around 'Square Mile' of London - not my case:

Example
Eloise, a computer consultant, is the only employee of a company which she controls.
She is a specialist in banking systems.
She spends 18 months working full-time at the headquarters of a merchant bank in
Lombard Street in the City of London. She then moves next door to design a new
computer system for a different bank where she expects to stay working full-time for
22 months.
After that assignment she moves to work at a bank close by on Cheapside for 17 months.
Eloise is not entitled to tax relief for her travel from home to these workplaces, because
the nature of her work is such that she expects to work continuously in the ‘Square Mile’
albeit on the premises of different banks. So her travel from home to work will be broadly
the same every day, year in year out (see paragraph 4.6).

[northernladuk]

In the scenario you put forward, you are changing modes of transport for the purpose of resetting the clock. I am looking at a genuine change of journey driven by a change in location.

As it happens, I have been taking a pretty convoluted route to London for the last 24 months, but inr that makes sense for this particular location in North London. I will now be taking the logical route to London. For my change of journey to be a sham, I would have had to be taking the awkward route for 23 months just so I could eventually change.

Thanks all for continuing contributions.

But that journey is only changed due to the modes of transport available, you still end up only 6 miles away. The fact the bus goes one way to get to A and the train goes the other way to location B is the same example as me changing modes of transport to reset the clock. HMRC won't want anything to do with the actual routes available by different modes of transport, particularly when it is a personal choice whether to drive or take whatever type of public transport.

Great example this Greg

[Old Greg]

But that journey is only changed due to the modes of transport available, you still end up only 6 miles away. The fact the bus goes one way to get to A and the train goes the other way to location B is the same example as me changing modes of transport to reset the clock. HMRC won't want anything to do with the actual routes available by different modes of transport, particularly when it is a personal choice whether to drive or take whatever type of public transport.

Great example this Greg

There does seem to be a confusion between destination (where you end up) and journey (which includes how you get there). The two are different in their every day meaning, and are differentiated in HMRC examples. If HMRC differentiates between journey and destination, then I can' see how the journey is broadly the same just because the destination is not that far apart.