Reply to: Mobile Phone Through Limited Company

[FarmerPalmer]

This still leaves open the question of whether, rather than a contract, a more cost-effective PAYG phone can be bought by and funded by the company for light users like me?

Can anyone give a learned opinion on this - then I think this thread can be ended.

I use Virgin PAYG and pay quarterly by direct debit - they just take the money for the calls I've made.

[TheFaQQer]

Every Accountant I have spoken to (including SJD who I am with) say putting your company address in the bill is enough.

Just ask them for a written guarantee that they will cover the additional costs if HMRC view it differently. If they are that confident of their advice, then they won't have a problem with putting their money where their mouth is. It's not what Nixon Williams, or my accountant say, though.

I've always thought that the contact needs to be in the name of the company (this is, after all, what the HMRC guidelines suggest). For what is might cost to be on a business tariff, you may as well do it right to avoid the risk that HMRC will clobber you for charges, and then go through your other expenses etc.

[Bluebird]

One of my colleagues was misinformed by one of the people at SJD over the mobile BIK issue, so I wouldn't necessarily trust their advice on this.

Change your personal contract to a business one. At the end of the day you're worrying about saving such small sums of money by blagging a personal account as your Ltd. you might as well do it properly.

your right, when I asked orange to put MyCos name on the bill they automatically changed it to a business service - charges were the same and the call sentre is UK based rather than Asian which means it's actually a bonus.

Don't know though whether they do PAYG for Business...

[swamp]

One of my colleagues was misinformed by one of the people at SJD over the mobile BIK issue, so I wouldn't necessarily trust their advice on this.

Change your personal contract to a business one. At the end of the day you're worrying about saving such small sums of money by blagging a personal account as your Ltd. you might as well do it properly.

[Bluebird]

Should be

Every Accountant I have spoken to (including SJD who I am with) say putting your company NAME in the bill is enough.

[Robwg]

Every Accountant I have spoken to (including SJD who I am with) say putting your company address in the bill is enough.

[Bluebird]

This still leaves open the question of whether, rather than a contract, a more cost-effective PAYG phone can be bought by and funded by the company for light users like me?

Can anyone give a learned opinion on this - then I think this thread can be ended.

Yes, you can use PAYG phone, although you'll either have to reclaim the expenses through your company or pay via your company bank account.

[Kess]

The provision of one mobile phone is exempt from any tax charge... To qualify, the contract must be in the name of the company and paid from the company bank account.

This still leaves open the question of whether, rather than a contract, a more cost-effective PAYG phone can be bought by and funded by the company for light users like me?

Can anyone give a learned opinion on this - then I think this thread can be ended.

[fridge]

The provision of one mobile phone is exempt from any tax charge. The exemption covers the telephone itself, any line rental and the cost of private calls paid by the employer on the telephone.

Notes:
•The number of phones provided for private use is restricted to one;
•Mobile phones provided to members of your family and household are excluded;
•To qualify, the contract must be in the name of the company and paid from the company bank account.
If you wish to claim for a personal mobile phone, then you can only claim for the business calls, you cannot claim for the rental cost or any private calls.

I hope this is clear!

Alan

[TheFaQQer]

Can I try and summarise this thread

Are we saying that if I change my mobile billing address to that of my company and change the DD to come out of my company bank account then that's OK?

I don't think that's enough. The contract would still be in your name, you would be liable for the bills etc. and it was you rather than the company was credit checked. Plus you would still be on a personal tariff rather than a business one.

[Sausage Surprise]

Can I try and summarise this thread

Are we saying that if I change my mobile billing address to that of my company and change the DD to come out of my company bank account then that's OK?

[Kess]

Also I would like clarification on treatment on two scenarios below in company accounts. would the £199, £299 & £400 respectively below be classified as capital expenditure hence not chargeable to P&L ?

1) Outright buy of a phone for £500 without contract but to use in PayAsUgo
2) if contract is £199 for the phone + £35 line rental
3) if I change my current personal contract to Ltd co. and then ask for a new phone thereby attracting a £400 Upgrade fee

Not sure if this was ever resolved, but I'm also interested to know the answer. I need a company phone for business use but don't make that many calls, so PAYG seems appropriate and cost-effective. However, I've read that a business phone contract, billed to the company, is recommended to keep HMRC happy.

The HMRC guidelines (EIM21779) state: "In most circumstances the provision of one mobile 'phone to a director or employee for private use is exempt from charge. The exemption covers the phone itself, any line rental and the cost of private calls paid for by the employer on that phone." It doesn't seem to matter by what mechanism the phone and calls are funded; I reckon it's within the rules for MyCo to buy a PAYG phone and then just pay for credit as needed.

Can anyone confirm my interpretation of the rules (perhaps one of our friendly accountants)?

Kess

[ash]

We do in our Starter Pack for new clients!

I'm a client and I must've missed that. I've been waiting to sign up on a new deal in my company name rather than transferring my existing one.

Hmmm... will have to re-read the starter pack.

[css_jay99]

hi, i would also like to know the answer to Limited's last question. Is that enough for HMRC ?

also I just 3 months into a new 1 month contract but would like to get the N95 phone. would they agree to an upgrade now ?


Also I would like clarification on treatment on two scenarios below in company accounts. would the £199, £299 & £400 respectively below be classified as capital expenditure hence not chargeable to P&L ?

1) Outright buy of a phone for £500 without contract but to use in PayAsUgo
2) if contract is £199 for the phone + £35 line rental
3) if I change my current personal contract to Ltd co. and then ask for a new phone thereby attracting a £400 Upgrade fee

cheers

css_jay99

bump bump !

[css_jay99]

hi, i would also like to know the answer to Limited's last question. Is that enough for HMRC ?

also I just 3 months into a new 1 month contract but would like to get the N95 phone. would they agree to an upgrade now ?


Also I would like clarification on treatment on two scenarios below in company accounts. would the £199, £299 & £400 respectively below be classified as capital expenditure hence not chargeable to P&L ?

1) Outright buy of a phone for £500 without contract but to use in PayAsUgo
2) if contract is £199 for the phone + £35 line rental
3) if I change my current personal contract to Ltd co. and then ask for a new phone thereby attracting a £400 Upgrade fee

cheers

css_jay99

help needed on my query please

cheers

css_jay99