The 24 Month Rule in a nutshell

[Contreras]

This really is a crock and hardly joined up thinking. I'm renting a flat at the moment for the contract I'm doing. I do it for a number of reasons. 1 - it allows me to have some of my stuff in one place, so I'm not lugging clothes and the like to the other end of the country. 2 - it gives me the flexibility if I'm needed at weekends without being stung for the cost of a hotel if I have to book at short notice. 3 - its way cheaper than hotels. As for it being available at weekends, yes it is, but I have a much bigger house where me and my family live. I work away from home enough throughout the week, I'm hardly going to jump at the chance of spending a weekend in a pokey little flat.

I thought MP's also had to pass the wholly and exclusively test for their expenses. Hardly seems fair that their role means they can rent accommodation but my company has to pay over the odds because it is only allowed to expense hotels.

But that is not the case. Did you read the judgement? Was my summary not clear?

HMRC argued that renting automatically had duality of purpose. They lost on this point.

HMRC succeeded in re-affirming that rent is not simply allowable wherever hotel expenses would be too. It was ruled that 'wholly and exclusively' should be tested on the facts of each case including the intent. One would hope that "I work away from home enough throughout the week, I'm hardly going to jump at the chance of spending a weekend in a pokey little flat" should be enough to qualify the intent in your case.

[BoredBloke]

I guess that my skim reading meant I got the wrong end of the stick and not for the first time!!

[SteelyDan]

I now find myself in this 'almost 24 months' situation.
3 month ext takes me to 25 months, so any reason why I can't reject the 3 monther, and say I'll only do one day short of 2 months, so give me a contract on that basis? Thereafter, if I choose to go on longer (for the rest of the original 3 months), then give me a contract for that remaining period & I'll not bother claiming mileage, etc from that point onwards. Not been in this situation before, so could this work?

[malvolio]

I now find myself in this 'almost 24 months' situation.
3 month ext takes me to 25 months, so any reason why I can't reject the 3 monther, and say I'll only do one day short of 2 months, so give me a contract on that basis? Thereafter, if I choose to go on longer (for the rest of the original 3 months), then give me a contract for that remaining period & I'll not bother claiming mileage, etc from that point onwards. Not been in this situation before, so could this work?

Yes, but two minor points: firstly it's the expectation that you will work over the 24 month boundary that matters which since you already have established as the intention you have already failed the rule, and secondly go look up the Ramsay principle...

[SteelyDan]

go look up the Ramsay principle...

I hate it when people do that...a 2 min task turns into an hour

So, if I take the extension, am I only forfeiting mileage from home office to site? If so, I can live with that scenario. Is subsistence affected by any of this?

But what about other travel from this client site to another (same client) site, as part of my work. Say I needed to travel to Aberdeen from my current site for 2 days...can I claim for the journey made from client site A to client site B?

[TheFaQQer]

But what about other travel from this client site to another (same client) site, as part of my work. Say I needed to travel to Aberdeen from my current site for 2 days...can I claim for the journey made from client site A to client site B?

It's travel to a temporary place of work, so claimable.

[malvolio]

It's travel to a temporary place of work, so claimable.

Agreed. Your permanent place of work becomes your usual client office, all else is temporary (apart from home, of course...) - although strictly speaking you should deduct your normal home-to-work mileage from any such claim.

[SteelyDan]

Thanks Mal/TF.

Just to be clear, with all of this 24 month rule, are we only talking about mileage claims, to/from the temp place of work?

Or does it also bring in subsistence/accommodation claims?

Ok, am reasonably happy to forfeit mileage claims on a 'home office to place of work' basis, but if I needed overnight accom/needed to eat while away, can I still claim that? It wouldn't be a regular basis, maybe now and again.

[LisaContractorUmbrella]

Thanks Mal/TF.

Just to be clear, with all of this 24 month rule, are we only talking about mileage claims, to/from the temp place of work?

Or does it also bring in subsistence/accommodation claims?

Ok, am reasonably happy to forfeit mileage claims on a 'home office to place of work' basis, but if I needed overnight accom/needed to eat while away, can I still claim that? It wouldn't be a regular basis, maybe now and again.

Subsistence and accommodation would also not be allowable I'm afraid if you have contravened the 24 month rule

[TheFaQQer]

Thanks Mal/TF.

Just to be clear, with all of this 24 month rule, are we only talking about mileage claims, to/from the temp place of work?

Or does it also bring in subsistence/accommodation claims?

Ok, am reasonably happy to forfeit mileage claims on a 'home office to place of work' basis, but if I needed overnight accom/needed to eat while away, can I still claim that? It wouldn't be a regular basis, maybe now and again.

I have always understood it to apply to travel, subsistence and accommodation expenses, but I may be wrong.

The rule relates to whether the location is seen as a permanent place of work, and I think you'd struggle to be able to argue that accommodation and subsistence for an employee to attend their permanent place of work were valid expenses.

That doesn't mean that you can't claim the expenses, it's just that they become a benefit in kind which is taxable.