When you have a minute...

[Ticktock]

It's not equal to everyone as an employee can't claim expenses for the first 24 months of a new job. He is expected to immediately move house, at least from an expenses point of view.

Expenses are meant to be for when you work somewhere different from your normal place of work; i.e. you need to have a normal place of work that's different from where you're claiming the expenses for. And you don't. So if one type of worker gets to claim travel expenses for up to two years, why doesn't every type of worker get to claim travel expenses for up to two years?

You are misunderstanding, although I can see why. The client site I travel to is not the site of my employer.

When I started my latest job it was as a director of MyCo, and I cannot claim expenses to travel to my (home) office.
When someone starts a new permie job they cannot claim expenses to travel to their office.

If I need to travel to a client site, I can claim as long as I know I will not be travelling there for over 2 years, MyCo will pay the costs and reduce their profit accordingly to save tax.
If a permie needs to travel to a client site then their employer will pay their expenses indefinitely, and be able to reduce profits, save tax (presumably for up to knowledge of >2 years?).

[NickFitz]

Many permies do the same, or at least have to travel to work. And you could always choose to live somewhere closer to where the work is; that's the kind of decision that millions have to make, it's not unique to contractors. I'm not saying I'm against the idea of being able to reclaim expenses, but perhaps it ought to apply equally to everyone.

That doesn't really work out for contractors though. To take a couple of recent years of my own: I worked north of Leeds, then in Cambridge, then in the East Midlands, then in London, then in a different part of the East Midlands, then in Cambridge again, then London again; and during that time I was approached about gigs in Manchester, Bristol, Reading, and other places I've forgotten about. Am I supposed to move home, lock, stock, horse and carriage every time?

[original PM]

You are misunderstanding, although I can see why. The client site I travel to is not the site of my employer.

When I started my latest job it was as a director of MyCo, and I cannot claim expenses to travel to my (home) office.
When someone starts a new permie job they cannot claim expenses to travel to their office.

If I need to travel to a client site, I can claim as long as I know I will not be travelling there for over 2 years, MyCo will pay the costs and reduce their profit accordingly to save tax.
If a permie needs to travel to a client site then their employer will pay their expenses indefinitely, and be able to reduce profits, save tax (presumably for up to knowledge of >2 years?).

It is important in this discussion to differentiate between Out of pocket expenses and expenses which are used to reduce your tax liability.

I am permie (yay) and often travel to our dev team's site - I can claim out of pocket expenses indefinitely for this.

However as a contractor what you are saying is that x amount of your invoice is classed as expenses and thus not subject to tax - what HMRC are saying is that if you are a disguised employee you should not do that as a normal employee cannot do that.

It really still comes back to the whole are you really running a ltd company and offering a genuine B2B service or are you really just a 'highly paid temp'

[TykeMerc]

That doesn't really work out for contractors though. To take a couple of recent years of my own: I worked north of Leeds, then in Cambridge, then in the East Midlands, then in London, then in a different part of the East Midlands, then in Cambridge again, then London again; and during that time I was approached about gigs in Manchester, Bristol, Reading, and other places I've forgotten about. Am I supposed to move home, lock, stock, horse and carriage every time?

If each is IR35 caught then literally speaking yes you should. Each engagement is effectively a permanent place of work, or at least that's how I read what's being proposed.
Absurd of course.

I doubt there's anyone on CUK (other than a troll) who honestly thinks it's a good idea as the way many of us tend to work it would make the cost of contracting prohibitive.

[VectraMan]

You are misunderstanding, although I can see why. The client site I travel to is not the site of my employer.

When I started my latest job it was as a director of MyCo, and I cannot claim expenses to travel to my (home) office.
When someone starts a new permie job they cannot claim expenses to travel to their office.

If I need to travel to a client site, I can claim as long as I know I will not be travelling there for over 2 years, MyCo will pay the costs and reduce their profit accordingly to save tax.
If a permie needs to travel to a client site then their employer will pay their expenses indefinitely, and be able to reduce profits, save tax (presumably for up to knowledge of >2 years?).

I understand. I was quite happy to use the same fiddle when I was a contractor. That's not the point.

A permie being sent to a client site would still be expected to return to their normal place of work and do significant work there. Contractors, at least most contractors, do not do this. If you engage in a 6 month contract then you're probably going to be there every working day for 6 months and don't do any work (other than perhaps a little bit of admin which isn't your main occupation) at what you say is your employer's office. The situation is no different to a temp working 6 months, or even a permie working 6 months and then being let go.

They could easily close the loophole by saying to claim expenses you have to do <50% of your work there. Then a WFH 3 days a week contractor could claim for the other 2, fair enough, but someone who is going to be on site for 2 years claiming that their home is their normal place of work is obviously stretching the truth.

[VectraMan]

That doesn't really work out for contractors though. To take a couple of recent years of my own: I worked north of Leeds, then in Cambridge, then in the East Midlands, then in London, then in a different part of the East Midlands, then in Cambridge again, then London again; and during that time I was approached about gigs in Manchester, Bristol, Reading, and other places I've forgotten about. Am I supposed to move home, lock, stock, horse and carriage every time?

That's up to you. Employees have to make the same decisions; it's not unique to contractors was my point.

[Ticktock]

I understand. I was quite happy to use the same fiddle when I was a contractor. That's not the point.

A permie being sent to a client site would still be expected to return to their normal place of work and do significant work there. Contractors, at least most contractors, do not do this. If you engage in a 6 month contract then you're probably going to be there every working day for 6 months and don't do any work (other than perhaps a little bit of admin which isn't your main occupation) at what you say is your employer's office. The situation is no different to a temp working 6 months, or even a permie working 6 months and then being let go.

They could easily close the loophole by saying to claim expenses you have to do <50% of your work there. Then a WFH 3 days a week contractor could claim for the other 2, fair enough, but someone who is going to be on site for 2 years claiming that their home is their normal place of work is obviously stretching the truth.

If you were on the fiddle then that's your business. Don't presume to know or understand how I do business, or my relationship with clients.

Again, a permie could be employed, sent directly to client site, work there every day for 6 months and be let go. They would claim expenses from their employer.
A temp is different, in that the temp has a relationship with an agency. Could they claim travel and subsistence from the agency? Yes - but it would be down to the agency to agree to that. My relationship is with MyCo, who do agree to pay, not with the agency.

[northernladuk]

Because contractors do not get the many things employees do - sick pay, maternal/paternal leave, paid holidays, free membership of company sports clubs, HR help on various things, not even use of subsidised canteens in some places. They also have to handle their own tax affairs, pensions etc. or pay somebody to do so. Employees get that all for nothing.

Rather glad I'm retired. Think when I'm on my last days, if I'm up to it, I shall do a suicide bombing in a tax office. It will be xoggoth's gift to CUK.

I think we have to be careful with our arguments here. You can have paid holidays, gym memberships etc.. It's just your company does not want to provide it as a benefit. Companies pay things to employees to keep them happy, not to affect their tax positions. I think a couple of comments might be forgetting this distinction so muddying the waters.

[Ticktock]

I think we have to be careful with our arguments here. You can have paid holidays, gym memberships etc.. It's just your company does not want to provide it as a benefit. Companies pay things to employees to keep them happy, not to affect their tax positions. I think a couple of comments might be forgetting this distinction so muddying the waters.

I think a lot of the confusion around all of this comes from a distinction not being made between what MyCo gets from my clients vs what I personally get from MyCo.

[TheFaQQer]

That doesn't really work out for contractors though. To take a couple of recent years of my own: I worked north of Leeds, then in Cambridge, then in the East Midlands, then in London, then in a different part of the East Midlands, then in Cambridge again, then London again; and during that time I was approached about gigs in Manchester, Bristol, Reading, and other places I've forgotten about. Am I supposed to move home, lock, stock, horse and carriage every time?

Yes - it's only fair