Two invoices in a month, one inside and one outside IR35

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Nixon Williams replied

22 November 2006, 10:29
Originally posted by kirk

Ok, so if I claim expenses it reduces my available dividend (non IR35 contract), so is it better to claim my expenses against the next months contract which is liable to IR35 regulations?!?!

Yes, I have asked my accountant the same thing and await his response!

An eagle eyed inspector would pick up on the different periods for work and expenses, so if you want to be safe then only claim expenses against the IR35 income if they were incurred when performing that contract.

Alan
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partimer replied

22 November 2006, 10:25
ir35 rubbish

This shows the stupid IR35 at its worst.
It's been a while but I vaguely remember that my accountant use to advise me to ring fence IR35 money separate from non-IR35 money. This meant expenses that occured whilst doing IR35 stuff came from that fund and dividends came out of the other.

Your accountant might suggest something different from mine.
Eventually I gave up doing this and do only non IR35 work and went into "business in my own account". I think that's the phrase they call it.
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tim123 replied

22 November 2006, 08:52
Sorry Gonzo that's wrong.

It is better to claim all of your allowed expenses against your IR35 income thus reducing it as much as possible. Leaving all of your non-IR35 income to be payable as a dividend.

tim
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Gonzo replied

21 November 2006, 23:27
Originally posted by kirk

Ok, so if I claim expenses it reduces my available dividend (non IR35 contract), so is it better to claim my expenses against the next months contract which is liable to IR35 regulations?!?!

Yes, I have asked my accountant the same thing and await his response!

I think that you are allowed to deduct a flat 5% expenses for contracts within IR35 so I would claim them against the non IR35 one.

However - which contract were you doing when the expenses were incurred? I don't think you could put the expenses for doing the IR35 contract against the non iR35 one if they weren't spent in fulifilling the non IR35 contract.

Just my two euro cents worth - wait for your accountant's advice.
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kirk started a topic Two invoices in a month, one inside and one outside IR35

21 November 2006, 23:19
Two invoices in a month, one inside and one outside IR35

Ok, so if I claim expenses it reduces my available dividend (non IR35 contract), so is it better to claim my expenses against the next months contract which is liable to IR35 regulations?!?!

Yes, I have asked my accountant the same thing and await his response!
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