Reply to: Renting Accomodation and claiming expenses.

Re: Maintenance?

I've recently joined Parasol and noted that 5-day restriction too. But the agent I spoke to said it was not the case, and gave me a calculation of weekly rent, divided by 7 days, and to claim for 5 day's worth of rent. So, is this a legitimate expense I can claim?

Re: Maintenance?

Thanks for the responses.

In response to Xoggoth and his question where I got the info regarding only renting for 5 days a week.

I was interested in joining parasol for an umbrella company (I have since gone ltd myself), but in their expense guidelines it says you can only claim rental costs if you are renting on a 5-day basis, and not for weekends.

Section 3.5

www.parasolit.co.uk/repos...0Guide.pdf


I am fairly new to this contracting business, so forgive me that I have yet to fully read up on all of the IR's advise booklets.

Thanks for pointing out that expnses are indeed claimable

Re: Maintenance?

That's correct ContractorUmbrella, but I'm still incurring additional costs by having to be away on business. These are considerable when I've no other option than to stay in a hotel. Just because I live in my family home, I shouldn't be dealt with unfavourably.

In fact, after reading the materials Bradley sourced his quote from, it seems the Revenue's own documentation confirms my argument. Please see my post(s) on the other thread and comment accordingly.

Re: Maintenance?

But presumably Clement you would not still be contributing to the cost of your family's property whilst you were working away?

Re: Weekend Accommodation

Relief should not be restricted for furnished or unfurnished accommodation that is of reasonable cost where it is also able to be used by the employee for weekends, short holidays during the period of work at the temporary workplace or other short non- working periods. Relief should be restricted where significant non-business use is part of the purpose of providing the accommodation

From IR SE Manual - www.inlandrevenue.gov.uk/manuals/senew/SE31836.htm

Re: Maintenance?

Hmmm, I understand that if I'd closed one rental for another closer by, my claim wouldn't be valid.

At the same time, the litmus test of "only property cost" is dubious. I live in London with my family. I contribute in kind and in cash toward the upkeep of the property, but I my name is not on any mortgage or rental agreement. As I'm an Australian national, I've no registration on the electoral roll to prove my residence there either.

So, by being away for work around the country, I'm certainly incurring additional property cost (esp. with hotels!). Surely this is claimable under the Revenue's regulations? There's many people who don't pay to "maintain" the property they live in...

Re: Maintenance?

Hello Clement,

It just means that the rental property would not be your only place of residence and therefore not your only property cost. You could not claim expenses for rent if you left your rented flat for another rented flat 50 miles down the road because it was nearer to the contract site as you had incurred no additional expense by doing so

Re: Maintenance?

Xoggoth, presume your post was directed at Morphman. If so, I'm in agreeance - the Revenue's own guide on expenses (booklet 480) states:

21.14... If accommodation is provided for an employee, for example in a flat or hotel, while the employee is on business duties away from his or her home and normal place of work, the cost of this may be allowable as a deduction under the expenses rule.... If the accommodation is no more than an alternative to hotel accommodation and is not available for private occupation the whole cost of renting and running the flat may be allowed as a deduction.

However, it also states:

21.14... The extent of any tax allowance will depend upon the circumstances.

This still doesn't answer the question of what yardstick the Revenue use to define one's "home". ContractorUmbrella refers to "maintenance", but there is no such reference in booklet 480.

Anyone?

Re: Maintenance?

Where on earth didyou come up with that 5 day only thing? It's crap. Subject to usual rules re 24 months etc. you can indeed claim costs of the weekly rental where a flat is rented as an alternative to a hotel. It does say this in booklet 480, you need to read it a bit more carefully. There might I suppose be a query if the family came to stay every weekend as they could claim it is partly for personal use but otherwise should be no problem.

You can also claim associated expenses like electric meter, cleaning etc but not rates. These are travel and subsistence costs claimable in addition to the 5% IR356 allowance.

Anything claimable theoretically has to be an extra cost undertaken for business reasons so if you did simply move around the country renting only near the contract site and had no home elsewhere I think it is correct it would not be claimable.

PS Dont forget PIEs.
PPS Whatever happened to the Paedophile Information Exchange?

Maintenance?

ContractorUmbrella, what do you mean by "you are still maintaining a propery elsewhere"?

Like Ronald, my home in London is a family property, so there's no mortgage, and my other family members' names are on the bills. But I contribute to these bills, and having to travel for my contract(s) means I incur very high costs while I'm on the road (incl. hotels and/ or rental) that I wouldn't otherwise have.

How does the Revenue define a home property? What constitutes "maintenance"? Is there a precedent/ ruling or some official documentation that defines this?

Anecdotal

Morphman,

I have done the following:-

Rented a house with the tenenancy agreement in MyCos name. All utilitiy bills were sent to that house - in the name of the company (might stuggle with council tax, but it was OK previously).

In a subsequent compliance review IR got a cob on, so I accepted 10% of the total paid by the company as BIK. [Some weekends wife would come to there rather than me go home etc].

And more recently:-

I personally bought a property close to where my main clients were. I claimed on expenses from the company:-

Mortgage interest
Council charge
Utilities
Food

IR were perfectly happy, I also reduced the expense claims by 10% to cover personal use.

And what about monthly travelcard?

Since moving to London, I obviously do not drive to work any more, and so do not claim my 40p a mile car journey to work (as non-billable travel expenses) to the IR.

But can I claim that part of my travelcard usage is for work purposes, and therefore can I claim back the cost (or part thereof) of my monthly travelcard against tax?

what's the experience of London-based contractors?

Thank you

I'm rapidly coming to the conclusion that the chap I worked with who had a company caravan had the right idea.

All he was paying for was the plot on the caravan site & services, which came to a lot less than £40/night in some poxy hotel.

He was taxed on a benefit in kind when it was used for family holidays though....

I've recently switched umbrellas. The old one made no mention of being able to claim for rental accomodation. I'm caught be IR35, and inside the 2 year maximum. The new umbrella made mention that I'd be able to claim it, but I assumed this was just spiel to get me to sign up with them. I tried searching through the mire of the IR website, but couldn't find anthing directly related to the situation. Would like something concrete before I try and claim for it.

Thanks for the replies guys.

Would I rent the flat via my limited company, or rent it in my personal name, and claim expenses back from the company account?

Also, can you confirm that its just Rent and Council tax that I can claim?