Accommodation expenses

**Sockpuppet** · 31 December 2006, 02:16

To be honest its more hassle than its worth if you are with family.

If you do get a written reciept for that expect hector to go looking at your nan for the income tax and nat insurance on this extra income.

Personally I wouldnt bother.

**Denny** · 31 December 2006, 02:41

Originally posted by Adamski

Hi all

Hope u had a good Xmas...

Have read some of the threads about accomm expenses and tbh am still confused. My permanent main residence (living with parents) is in the Mids. Got a contract in London and am living with family. What can I claim? Umbrella need to see receipts so will get a written one from the aunt I'm stayin with. Contribute to household but haven't got a formal tenancy agreement. Normal rentals for rooms is about £400/month...so am thinking will claim for that. I stay there Mon-Fri am go back to Mids at weekends, but leave my stuff in the room at my aunts. Am I doing anything wrong in claiming? Hope that makes sense...thanks!

You've got no chance making this legit.' It's not because you are living with family that's the problem, it's because you are not actually paying the rent you are claiming as tax deductable expenditure.

The golden rule is if you're not paying it out you can't claim it. What you seem to be cooking up is good old fashioned fraud with the intent to evade tax which is illegal, plus you are asking your aunt to be co-conspirator by giving you phoney receipts for rent you're actually not going to pay out. So unless you are actually being charged the rent you want to claim and you have entered into a formal tenancy arrangement with your aunt with written documentation to back it up to give this arrangement some legitimacy, you could come seriously unstuck during an investigation. After all, the IR would definitely want to see an audit trail, particularly when they find out you are staying with family, and check out your Aunt's bank account to see that the money is in fact being paid out at regular intervals for the duration of your stay. Even then the IR may take a dim view of this whole arrangment, if your Aunt is not already in business as a landlord to outsideers, as they may conclude that any audit trail in place has been specifically set up for you and therefore phoney and that your Aunt will probably come to some arrangement somewhere down the line to pay you back the money some time later.

It's not worth taking that risk, not least because you are involving someone else in this fraud (which is how the IR will view it). If you are living rent free be grateful for that alone, or if you have come to some arrangement to pay out some token rent, just claim for what is legit' get it receipted and claim no more than the amount you will genuinely be paying out.

**vetran** · 31 December 2006, 14:57

Try this

http://www.hmrc.gov.uk/manuals/eimanual/eim30073.htm

of course IANAA, check with yours.

**Adamski** · 3 January 2007, 11:36

Had a look and thanks to everyone for their input - has helped a lot. Think Denny has misunderstood my intentions (although you did make valid points so thanks for that)…Although I have not officially got a tenancy agreement, I was paying for other things (shopping etc.) in lieu of rent but don’t think this arrangement is working in my favour . Did some research and Hector has a 'rent a room' policy which is what I will put in place with my aunt. As long as the rental income she earns doesn't go over a certain threshold (think it works out to just over £80/week), then she's not liable to pay tax on it. Seems that a more formal agreement is the way forward, so will get receipts etc…I obviously won't be claiming for expenses I'm not incurring, but think why shouldn't I claim for legitimate ones as rather have the pennies in my pocket instead of Hectors. ;-) Well thanks for the input everyone.

**boredsenseless** · 3 January 2007, 12:19

Originally posted by Adamski

Had a look and thanks to everyone for their input - has helped a lot. Think Denny has misunderstood my intentions (although you did make valid points so thanks for that)…Although I have not officially got a tenancy agreement, I was paying for other things (shopping etc.) in lieu of rent but don’t think this arrangement is working in my favour . Did some research and Hector has a 'rent a room' policy which is what I will put in place with my aunt. As long as the rental income she earns doesn't go over a certain threshold (think it works out to just over £80/week), then she's not liable to pay tax on it. Seems that a more formal agreement is the way forward, so will get receipts etc…I obviously won't be claiming for expenses I'm not incurring, but think why shouldn't I claim for legitimate ones as rather have the pennies in my pocket instead of Hectors. ;-) Well thanks for the input everyone.

Also either transfer the money electronically from the company account or write a company cheque. Cash for anything other than a cup of coffee (or similar) always looks a little dodgy.

It does of course mean that your aunt can't hise the income and she might not like that though.

Accommodation expenses