Any non IR35 reasons not to claim expenses directly from the client?

[vwdan]

If you are claiming directly from the client then there must be a direct relationship between you and the client, so you are saying your Ltd is not involved. Do you have a contract between you personally and the client? Are you (and your client) happy not to be covered by the insurance policies your Ltd has taken out? Are you happy not to be protected by limited liability?

Are you on Fixed Rate Scheme? You're losing out on a little bit of money - the difference between the 20% VAT charged and the 14% paid onwards.

I'm sorry - but I really don't buy this. By them paying for my hotel, I'm voiding my business insurance - yeah right. They're engaging my Ltd company to do some work - even as a permie, I've stayed at hotels booked by clients before now. Are you saying that under those circumstances the company I was working for wasn't insured?

No fixed rate here.

[vwdan]

To keep it simpler, I'd be looking for the client to pay for the expense items directly rather than me trying to claim it back from them after paying for the item myself.

E.g. pool/hire car, train tickets, hotel rooms, whatever, all paid up front by the client then it's their problem how the expense is accounted for.

Depends on the amounts in question. If not thousands just get them to pay you out of 'petty cash' in a brown envelope so no trace.

Agreed - this is what I'm going to try and do for the bigger stuff. The problem is the little things, like evening meals or even just when my schedule doesn't quite sort itself out in time.

Personally I'd prefer to send an itemised company invoice over - day rate plus itemised expenses.

I would too, the problem here is going to be the double VAT thing and as of yet I still can't find any solid reason why I shouldn't use their system.

[Hobosapien]

I did this some years ago in response to a similar situation.

Thanks. Good to know it's a potentially workable approach and not another of my 'pie in the sky' ideas.

[Old Greg]

To keep it simpler, I'd be looking for the client to pay for the expense items directly rather than me trying to claim it back from them after paying for the item myself.

E.g. pool/hire car, train tickets, hotel rooms, whatever, all paid up front by the client then it's their problem how the expense is accounted for.

Depends on the amounts in question. If not thousands just get them to pay you out of 'petty cash' in a brown envelope so no trace.

I did this some years ago in response to a similar situation.

[LondonManc]

This may be somewhat alarmist, but if you're not putting something through the company that's clearly directly connected to the work the company is doing it could look like you're falsifying your accounts, evading Corporation tax, evading VAT, or even taking bribes. Accepting a lower rate in exchange for them giving you money personally is a bit of a red flag for the latter.

As a third party, I'd either want the client to directly pick up the expenses or claim them myself and charge back via MyCo.

[VectraMan]

This may be somewhat alarmist, but if you're not putting something through the company that's clearly directly connected to the work the company is doing it could look like you're falsifying your accounts, evading Corporation tax, evading VAT, or even taking bribes. Accepting a lower rate in exchange for them giving you money personally is a bit of a red flag for the latter.

[LondonManc]

To keep it simpler, I'd be looking for the client to pay for the expense items directly rather than me trying to claim it back from them after paying for the item myself.

E.g. pool/hire car, train tickets, hotel rooms, whatever, all paid up front by the client then it's their problem how the expense is accounted for.

Depends on the amounts in question. If not thousands just get them to pay you out of 'petty cash' in a brown envelope so no trace.

Or that.

Either ClientCo picks up the tab directly or YourCo picks them up and invoices them as part of your overall monthly invoice.

[Hobosapien]

To keep it simpler, I'd be looking for the client to pay for the expense items directly rather than me trying to claim it back from them after paying for the item myself.

E.g. pool/hire car, train tickets, hotel rooms, whatever, all paid up front by the client then it's their problem how the expense is accounted for.

Depends on the amounts in question. If not thousands just get them to pay you out of 'petty cash' in a brown envelope so no trace.

[LondonManc]

Personally I'd prefer to send an itemised company invoice over - day rate plus itemised expenses.

[ASB]

A business can pay anyone expenses that they have incurred on their behalf.

However it does mean they need to declare it and to whom on their end of year retrurns. I uave no idea what the consequences f this would be.

I am sure you would remember the question if you have signed your own p14 etc.

It does complicate things somewhat.

I have done exactly as describe. Never again. First barrier to actually doing it was a complete lack of an employee number.

The only reason I assume is to hide some of the cost dues to the internal way expenses are handled.

[Forgotmylogin]

Have you asked your accountant?







The costs incurred by you travelling are incurred by your Ltd, not by you personally.
Ideally you'd use a separate business credit card to pay for them to really keep them separate. If you pay using personal funds then you're doing so on behalf of your Ltd, and need to reclaim from your Ltd. Whether your Ltd then reclaims all, half, none of these from your client is a business decision.

If you are claiming directly from the client then there must be a direct relationship between you and the client, so you are saying your Ltd is not involved. Do you have a contract between you personally and the client? Are you (and your client) happy not to be covered by the insurance policies your Ltd has taken out? Are you happy not to be protected by limited liability?

Are you on Fixed Rate Scheme? You're losing out on a little bit of money - the difference between the 20% VAT charged and the 14% paid onwards.

[vwdan]

Evening all! I'm doing a little bit of adhoc work for an old client over summer - it's essentially a favour as I meant to be taking some time off. Anyway, it's about as far from IR35 as it could be (I'm juggling them and another client, with neither having any guarantee over my time and neither guaranteeing any work. Lots of financial risk for me, no MOO, no control). In order to control their costs and keep my rate a little lower (And to save me having to invent a "London Rate" and a "Scotland Rate" etc), they want to specifically cover some travel expenses and have asked me to claim them through their normal channels (I should add that they're small, so this amounts to sending a spreadsheet/e-mail to the office admin) and they'll pay them to me personally. The work will be invoiced as normal through my Ltd. I, personally, don't have any issue with that but I can find a few posts/articles mentioning that I shouldn't - but I can't see any firm reason why not. I'm sincerely not worried about IR35, so is there any other particular reason to care?

In addition, if I DO claim via their form can I bolster their allowed expenses with my own. For example, let's say they'll cover the hotel but not dinner - can I claim for the hotel through them and the dinner through MyCo?