Reply to: Car vandalised whilst at ClientCo - Repairs reimbursable?

[Spartacus]

Which is pretty much what everyone apart from Spartacus has said throughout the course of this thread.

I'm just relating what actually happened (twice). Everyone else is theorising.

The OP must make their own mind up of course, or >gasp< seek professional advice from their accountant.

[TheFaQQer]

i wouldn't consider it relief. If the OP were to sue his employer (himself) because he suffered a loss while on company business - he would claim damages to being him back to the state he were in before he suffered that loss. That would be the cost of the repairs.

If you don't consider the repayment of the expense to the employee as relief, then you agree that if the company makes an additional payment outside the scope of the tax-free amount, then no tax relief should be applied and the employee would be taxed on it.

Which is pretty much what everyone apart from Spartacus has said throughout the course of this thread.

[TheFaQQer]

I guess the point was - that if you were driving for business purposes (excepting commuting as you are claiming business mileage so not commuting) - are you actually insured for driving for business to a client. I think only Direct Line covers this.

I've always added it to my policy, and have never used Direct Line.

My current policy with Aviva says

Description of use
Use for social, domestic and pleasure purposes.
Use for travel to or from a place of paid employment.
Use for <TF> business or their spouse/domestic/civil partner in connection with their business

[Spartacus]

Thinking about it, this has actually happened to me twice (I've been in the game a long time, some mornings I can't remember my own name).

The other occasion, with a different employer, was very similar but I was visiting one of their own sites. Car was vandalised and the result was the same - the employer paid for it all including the cost of recovery (the car was totally trashed and undriveable), and there was no tax implication for me. They were an insurer as it happens (although not a motor insurer).

[Spartacus]

I'll just go back to what actually happened to me as opposed to all this theorising.

I was an employee on a business trip to a competitor's site. I used my own car. I claimed mileage for the trip. While my car was parked at the site (on a public street) it was vandalised. My employer (a large multi-national that employed hundreds if not thousand of lawyers and accountants) said this fell within their duty of care*, paid for the cost of all the repairs and the use of a hire car while my car was in the garage. There was no discussion of excesses or my insurance at all, my insurer never even heard about it. The not insignificant cost did not appear on my P11D, nor was my tax code adjusted to compensate for it. There was no fault accruing to me, and the only reason it happened was because of the business trip (I did not use my car to commute to my regular office).


* Like they said at the time, if they just told people to whom this sort of thing happened "tough t1tty", then no one would ever use their own cars for business travel and they would have to pay out much more in maintaining a fleet, hiring cars, paying for business class travel, etc.

[Contreras]

If you're an employee then despite being taxed you'd probably be pretty happy if your employee covered your loss as you're only losing out a little bit (you just pay the tax, the repair bill is covered).

Any employer stupidhappy to stump up the excess on a personal insurance claim (for what is criminal damage that didn't even happen on their premises!) is probably going to be minded to suffer the tax on it as well.

pa, you can do this too, btw. If it makes you feel better.

[TheCyclingProgrammer]

What loss? You don't get it, do you. Just because HMRC won't allow the expense as deductible doesn't mean the company can't pay for it. This same rule applies whether the company is Mega Corp. Ltd. or One Man & His Dog Ltd.

WHS. Of course your company can reimburse you for your losses and I'm sure many would in this scenario. The point is there is no tax relief available on such payments - use of your own car is covered by AMAPs - so any reimbursement will be taxed.

If you're an employee then despite being taxed you'd probably be pretty happy if your employee covered your loss as you're only losing out a little bit (you just pay the tax, the repair bill is covered).

But it's pretty pointless of it's your own company reimbursing you.

[TheCyclingProgrammer]

I guess most policies cover drivers for 'social, domestic and commuting'. Neither of these cover travelling to a client site if you are claiming business mileage. You are either commuting or you are not.

Mind covers be for business use. Don't think I've seen it not offered. I think there are different classes of business use but it barely increases my premium.

[Contreras]

Fair point. We can all agree to disagree and at the end of the day, it's the HMRC inspector that has to listen to the argument and decide whether they are happy to allow the expense or not. I do feel strongly that just because you are a contractor - you shouldn't have to suffer loss while on business (i.e. having to pay for stuff yourself when it's your Co that should be paying). Equally, I'll go the other way and say that wide-screen TV in your living room is not a business expense!

What loss? You don't get it, do you. Just because HMRC won't allow the expense as deductible doesn't mean the company can't pay for it. This same rule applies whether the company is Mega Corp. Ltd. or One Man & His Dog Ltd.

[pacontracting]

My car got dirty when I went to visit a client. Also I spilt a Maccy D's milkshake on the passenger seat while I was there.

Can I claim for a valet cos my car wouldn't be dirty or have putrid strawberry milkshake on the seat if I hadn't gone?

Blimey - lawyers must have a field day with you lot.

That's your fault - not a loss you suffered. If someone else does something while you are about your employers business - you can claim. If you are just stupid - you can't. ;-)

[pacontracting]

It's not business tho is since you are an employee like anyone else. It's travel to work. Again...

I think post no: 37 covers this comment. (not my words though!)

[stek]

I see your point but I disagree. From my point of view - any activity that places me (as the employee) in a position of loss outside my normal, personal lifestyle (i.e. while on business) is the responsibility of my employer (my Co). My Co is therefore liable. You hear many incidents of employees suing their employers for all sorts. I don't see any difference in this case. Obviously, fake claims etc are not on and if this incident really did happen as stated - I would have no issue as a company director or authorising payment to the employee.

It's not business tho is since you are an employee like anyone else. It's travel to work. Again...

[stek]

I usually deduce what a policy covers by reading the policy. It's usually pretty clear whether the policy you are buying covers business use. I'm happy for you to suggest a personal policy that covers business use by default (apart from Direct Line).

Do the majority of contractors think about this before they buy their policy? I hope they do and specify business use as part of the application process but I'm sure there are those that don't.

It's not business tho is since you are an employee like anyone else. It's travel to work.

[DiscoStu]

I see your point but I disagree. From my point of view - any activity that places me (as the employee) in a position of loss outside my normal, personal lifestyle (i.e. while on business) is the responsibility of my employer (my Co). My Co is therefore liable. You hear many incidents of employees suing their employers for all sorts. I don't see any difference in this case. Obviously, fake claims etc are not on and if this incident really did happen as stated - I would have no issue as a company director or authorising payment to the employee.

My car got dirty when I went to visit a client. Also I spilt a Maccy D's milkshake on the passenger seat while I was there.

Can I claim for a valet cos my car wouldn't be dirty or have putrid strawberry milkshake on the seat if I hadn't gone?

[pacontracting]

FFS, this is like arguing with AtW

Fair point. We can all agree to disagree and at the end of the day, it's the HMRC inspector that has to listen to the argument and decide whether they are happy to allow the expense or not. I do feel strongly that just because you are a contractor - you shouldn't have to suffer loss while on business (i.e. having to pay for stuff yourself when it's your Co that should be paying). Equally, I'll go the other way and say that wide-screen TV in your living room is not a business expense!