Reply to: WFH and expenses

[oilboil]

!! 6 quid a week, is it really worth the effort

It isn't really any effort, I work from home all the time. I just claim the amount every 6 months. I'd rather have 300 quid a year in my pocket tax-free rather than 240 quid and 60 quid taken off in tax.

It isn't any effort (well ok it's 30 seconds effort to raise the expense in XERO)

[TheCyclingProgrammer]

Yes it's pro-rated. But as mentioned earlier in the thread, just claim it monthly as an expense claim to your CO. I can't be arsed to count the weeks since April 6th till end of this month so I'll say that you're probably correct.

Yes there's a monthly. That's £26 (6 x 52 / 12)

Rate confirmed here:
Claim tax relief for your job expenses: Working at home - GOV.UK

[Lance]

As the homeworking allowance increased from £4 to £6 per week (effective from April) how much you claim for a company year that ends this month, for example? 44 weeks at £4 and 8 weeks at £6?

Also, it used to be £4 per week or £18 per month so my accountant posted £216 (12*£18) instead of £208 (52*£4) as it was a tiny bit more - I'm not fussed about it but curious as to if there is an equivalent monthly allowance available? Only the weekly allowance was mentioned in the Budget Red Book so I suppose not...

Cheers.

Yes it's pro-rated. But as mentioned earlier in the thread, just claim it monthly as an expense claim to your CO. I can't be arsed to count the weeks since April 6th till end of this month so I'll say that you're probably correct.

Yes there's a monthly. That's £26 (6 x 52 / 12)

[SDR]

As the homeworking allowance increased from £4 to £6 per week (effective from April) how much you claim for a company year that ends this month, for example? 44 weeks at £4 and 8 weeks at £6?

Also, it used to be £4 per week or £18 per month so my accountant posted £216 (12*£18) instead of £208 (52*£4) as it was a tiny bit more - I'm not fussed about it but curious as to if there is an equivalent monthly allowance available? Only the weekly allowance was mentioned in the Budget Red Book so I suppose not...

Cheers.

[KinooOrKinog]

Depends on other expenses, when I am working away an incurring them frequently I do them monthly, at the moment I am pulling them off when ever I see a nice bottle of single malt I want

You're what??

[SimonMac]

do you do the standing order once a year for 300 or per week for 6 quid?

Depends on other expenses, when I am working away an incurring them frequently I do them monthly, at the moment I am pulling them off when ever I see a nice bottle of single malt I want

[xenomorph]

I just set up a recurring expense in FreeAgent, and a standing order. It's £300 a year, tax free, no matter how you cut it!

do you do the standing order once a year for 300 or per week for 6 quid?

[Old Greg]

It proves I know just enough to get it right but not know how right it really is...

I’m a fooking techie not an accountant.

Sometimes you just need to be able to smell that there's money to be saved or made.

[Lance]

That £1000 would have been £810 to be distributed in dividends after CT.

If in basic rate band, that would have incurred another £60.75, costing you a total of £250.75, leaving you a net of £749.25 if you used dividends.

If in higher rate band, that would have incurred another £263.25 in div tax, costing you a total of £453.25.

So your 10 minutes saved you somewhere between £250.75 and £453.25, depending on whether you were into higher rate band each year or not.

You will have to decide whether this discussion proves you are really intelligent, because you took advantage of this to save hundreds in tax, or whether it proves you are really stupid since you thought it only saved you £75. I choose not to have an opinion on the question.

It proves I know just enough to get it right but not know how right it really is...

I’m a fooking techie not an accountant.

[WordIsBond]

that was merely speculative assuming a tax saving of the basic dividend rate.
As I've already used that allowance it's more like £325....

I think it would take longer to email the accountant to ask him to make a recurring expense on FA than it would to do it myself./
And that it still less time than to write this....

That £1000 would have been £810 to be distributed in dividends after CT.

If in basic rate band, that would have incurred another £60.75, costing you a total of £250.75, leaving you a net of £749.25 if you used dividends.

If in higher rate band, that would have incurred another £263.25 in div tax, costing you a total of £453.25.

So your 10 minutes saved you somewhere between £250.75 and £453.25, depending on whether you were into higher rate band each year or not.

You will have to decide whether this discussion proves you are really intelligent, because you took advantage of this to save hundreds in tax, or whether it proves you are really stupid since you thought it only saved you £75. I choose not to have an opinion on the question.

[Old Greg]

And all that follows - better retained profits or increased dividends available, etc.

The brutal tax system in Ireland at least has the benefit of simplicity. Anything I put through the company 'saves me in tax' 50% if not reclaiming VAT and 60% if reclaiming VAT - more or less.

Ireland has an eWorker allowance of €3.20 per day and it's being promoted by Revenue as relevant to home working during pandemic.

[LondonManc]

CT saving as well.

And all that follows - better retained profits or increased dividends available, etc.

[Old Greg]

that was merely speculative assuming a tax saving of the basic dividend rate.
As I've already used that allowance it's more like £325....

I think it would take longer to email the accountant to ask him to make a recurring expense on FA than it would to do it myself./
And that it still less time than to write this....

CT saving as well.

[Lance]

If you're only saving 7.5% you're doing something wrong. Maybe the guy who asks his accountant to handle it is onto something.

that was merely speculative assuming a tax saving of the basic dividend rate.
As I've already used that allowance it's more like £325....

I think it would take longer to email the accountant to ask him to make a recurring expense on FA than it would to do it myself./
And that it still less time than to write this....

[WordIsBond]

If you just count the tax saving at 7.5% that's still not bad at over £75 for 10 minutes.

If you're only saving 7.5% you're doing something wrong. Maybe the guy who asks his accountant to handle it is onto something.