Are dinner expenses um... ethical?

[mudskipper]

1) Who do you think your employer is? Your client is not your employer and won't give a monkey's fart what expenses you claim.

2) Who do you think pays your expenses? No one is going to give you money - you pay your expenses, the 'expense' bit means you get the money back from what you earn before tax.

3) You can only claim expenses if you're going to have > 1 assignment with the umbrella

4) Subject to 3, yes, you should claim. I don't understand people who don't put through what they're legitimately allowed to claim.

Sounds like there's a basic failure of understanding.

NorthernladUK Comment generator

[Wanderer]

They told me that if I'm away from home, for my job, for 10 hours or more per day, I can claim dinner expenses.

Some of the things you can claim are counter intuitive but if they allow you to do it then go for it. They will often pay round sums for a meal allowances, this is permitted so long as you incur some amount of expense (however small).

Do remember though that your expenses come out of your pay, it's not like being a permie where your employer pays your expenses, in this situation the expenses come out of your own pocket. The advantage you get from claiming expenses is that this part of your income is paid to you tax free.

[EternalOptimist]

Hi everybody.

I'm new to contracting, got my job through a recruitment agency, and signed up with an umbrella company. They told me that if I'm away from home, for my job, for 10 hours or more per day, I can claim dinner expenses. My hours of work are from 09:00 to 17:30, so that's not unusually long, but the journey to work is an hour each way, so all in all, I'm out of the house for 10.5 hours. So I could claim for dinner, but now I'm thinking that it's just going to leave a bad taste in my employer's mouth (no pun intended). So my question is: is this something that contractors generally do, as a matter of course, and that employers don't have a problem with? Would I be standing up for my rights, or taking the p**s, if I claimed for it?

Also, what are the rules regarding receipts for meal expenses? On my first day, I bought lunch in the morning, on my way to work, so does that mean I can't claim for it, because I didn't buy it at around lunch time?

Thank you in advance.

The IR will very rarely accept things done by halfs




<cough>

[half]

???

The expenses come out of my pay? So I go to the supermarket and buy a sandwich, then claim for it, so they take a sum out of my wages, then pay them back to me, after taking off tax? So I'm paying for the sandwich, and the expense claim on top of that? I've no idea who's supposed to be paying for these expenses; I thought you experienced contractors might have an idea of how it's usually done. And as for the time I buy the stuff, that's what I understood from the regulations I was given. Yes, there is a failure in understanding; I'm thoroughly confused now.

[half]

...

Where's the head shaking smiley?

I'll just use this one instead

Thank you so much, that is profoundly helpful.

[cojak]

The expenses come out of my pay? So I go to the supermarket and buy a sandwich, then claim for it, so they take a sum out of my wages, then pay them back to me, after taking off tax? So I'm paying for the sandwich, and the expense claim on top of that? I've no idea who's supposed to be paying for these expenses; I thought you experienced contractors might have an idea of how it's usually done. And as for the time I buy the stuff, that's what I understood from the regulations I was given. Yes, there is a failure in understanding; I'm thoroughly confused now.

Well there you go, now you know.

[mudskipper]

The expenses come out of my pay? So I go to the supermarket and buy a sandwich, then claim for it, so they take a sum out of my wages, then pay them back to me, after taking off tax? So I'm paying for the sandwich, and the expense claim on top of that? I've no idea who's supposed to be paying for these expenses; I thought you experienced contractors might have an idea of how it's usually done. And as for the time I buy the stuff, that's what I understood from the regulations I was given. Yes, there is a failure in understanding; I'm thoroughly confused now.

before taking off tax

Expenses are tax deductible - that's the advantage of putting them through as expenses, if your sandwich costs £3, then you don't pay tax (or NI?) on the £3 you spent on the sandwich.
No idea about the time - I buy my lunch at lunchtime.

[Wanderer]

I've no idea who's supposed to be paying for these expenses; I thought you experienced contractors might have an idea of how it's usually done.

Yes, we do know how it's done. It's a bit confusing at first.

Normally an employer will reimburse your expenses on top of your wages but that is not the case here. Don't think of the umbrella as your "employer" because they aren't - you are actually self employed and all the umbrella does is run a payroll for you.

So, let's say you earn £1000 per week and your net pay after tax deductions is £500.

Now let's say you incur £100 in expenses (meals, travel, etc) for that week.

If the expenses are allowed then you get that part of your income tax free so you pay tax on £1000 - £100 = £900. So the total tax due is £450 and your net pay is £1000 - £450 = £550 so you are £50 better off.

The trick is that you probably would have incurred those same expenses working in a permie job anyway so you are a bit better off as self-employed because you can claim them as a tax free income.

[Pondlife]

What about supper? Or brunch? Or tiffin? Or High Tea? Or elevensies? Or twelvesies!!!!

I don't think he knows about second breakfast, Pip.

[LisaContractorUmbrella]

Have a look here - this will explain it all for you EIM05231 - Employment income: scale rate expenses: subsistence expenses: table of benchmark scale rates

Actually, as this is an HMRC link it probably won't explain very much at all but I can provide a translation if necessary