Reply to: Mobile Phone for Personal Use but Claimed as Expense...

[manclarky]

I assume you're not charging your dog food bills to the company as well?

"Food for guard dog"....?

[TheCyclingProgrammer]

Have you asked O2 if you can transfer it to your business name?.

No, but I doubt they'd oblige as it is clearly a personal plan. But even then, I can live without the £50 a year tax saving.

[SueEllen]

But my contract is with O2 on their iPhone simplicity plan (in my name) which is great value and I really don't think it's worth transferring to a business account. I don't bother claiming business call costs either, it's simply not worth it as most of them are part of my free minutes anyway.

Have you asked O2 if you can transfer it to your business name?

O2, Vodafone and T-mobile tend to be the happiest in doing that.

3 have cr*p customer service so I won't ask them anything, and I've never been on an Orange/Virgin Mobile/Tesco pay monthly plan.

[Wanderer]

Have seen business contracts and agree they're rubbish compared to personal ones; so you had no problem at all transferring a personal contract into a company name??? If so then I'll probably try going down that route aswell.

Really? I just signed up with T-Mobile on a business tariff and it's exactly the same as the personal one...

100 Min, 100 Txt, 1 Gig data, 30 day contract: £8.51 + VAT

I don't see why a business should pay extra, it's just a phone. If your mobile operator can't sort something out then I suggest you try a different one.

[MarillionFan]

I'm not that convinced.

I purchased my last phone, an iPhone 4, as a capital asset through my company. HMRC considers an iPhone to be a computer rather than a phone anyway, but it was worth doing as I was buying it outright and there was a reasonable tax saving.

But my contract is with O2 on their iPhone simplicity plan (in my name) which is great value and I really don't think it's worth transferring to a business account. I don't bother claiming business call costs either, it's simply not worth it as
most of them are part of my free minutes anyway.

WHS

This misplaced concept that every bill,receipt,invoice,correspondence,interaction must perfectly match the rules out lain by Hector is nonsense.

If you are honestly in business and can show that costs were incurred that's fine. The anal / pedantic view of some posters on this forum that a single incorrect receipt will bring the sword of Damocles down upon their heads is nonsense .

Put your phone bill and rental through, if one day Hector gives you an audit(which is highly unlikely) then debate it then.

[TheCyclingProgrammer]

Every contractor should have a company phone. You will get a rubbish call plan, but the tax savings will more than make up for it. Also you will get better customer service. No Bangalore call centres for us Limited Companies

I'm not that convinced.

I purchased my last phone, an iPhone 4, as a capital asset through my company. HMRC considers an iPhone to be a computer rather than a phone anyway, but it was worth doing as I was buying it outright and there was a reasonable tax saving.

But my contract is with O2 on their iPhone simplicity plan (in my name) which is great value and I really don't think it's worth transferring to a business account. I don't bother claiming business call costs either, it's simply not worth it as most of them are part of my free minutes anyway.

[TheCyclingProgrammer]

It has happened, so the only way forward is to pay back the money you now owe your company.

Not true at all. There is nothing essentially wrong with what the OP has claimed; you can claim whatever you like from YourCo as an expense, it's whether or not it is considered a BIK that determines whether or not it is liable to tax and/or NIC.

In this case, only business calls would have been been a valid business expense but he doesn't have to pay his company back, he can simply declare the value of the personal calls and line rental on his P11d and declare them on his personal tax return as a taxable benefit and pay tax/NI accordingly.

[MarillionFan]

I put the bill through every month and have done for ten years and it's in my name not the companies. I need to be contacted.

If Hector wants to pull me for it, good luck we can argue it later.

[swamp]

Every contractor should have a company phone. You will get a rubbish call plan, but the tax savings will more than make up for it. Also you will get better customer service. No Bangalore call centres for us Limited Companies

[crgritchie]

Right, so i'll be paying the expenses back...

As for the contract... I simply rang Orange and asked for the contract to be transferred to the company name... they credit checked the company, waived a £150 charge and said it'll be in the company name from the next bill onwards. The call plan, cost and length of contract all continues exactly the same.

The problem with setting up a contract from new on a company tariff is that you get a rubbish call plan... I think in future if I change from Orange i'll always set it up as a personal phone and a month in change the contract over to the company... that way you get the best of both worlds...

Have seen business contracts and agree they're rubbish compared to personal ones; so you had no problem at all transferring a personal contract into a company name??? If so then I'll probably try going down that route aswell.

[shippwreck]

Right, so i'll be paying the expenses back...

As for the contract... I simply rang Orange and asked for the contract to be transferred to the company name... they credit checked the company, waived a £150 charge and said it'll be in the company name from the next bill onwards. The call plan, cost and length of contract all continues exactly the same.

The problem with setting up a contract from new on a company tariff is that you get a rubbish call plan... I think in future if I change from Orange i'll always set it up as a personal phone and a month in change the contract over to the company... that way you get the best of both worlds...

[Integrity]

LOL, well of course i'd love to charge the mortgage, but don't

There was a pragraph here... but Dave B answered it so i removed it

hmmm, so does that mean that I now have to "give back" to my company the extra in expenses I claimed over the year for the phone, or will Mr Taxman sort that out by taxing it accordingly for me... obviously the expenses have been paid now so I can't change that... just wondering the best way to correct the error?

Balls!

Thanks for your help guys!

It has happened, so the only way forward is to pay back the money you now owe your company. If you list the error on your next expenses document, then your expenses will show a negative amount (maybe), and the paper trail will be accurate.

Moving forward, consider cancelling the contract and taking out a new contract in the company name.

[shippwreck]

LOL, well of course i'd love to charge the mortgage, but don't

There was a pragraph here... but Dave B answered it so i removed it

hmmm, so does that mean that I now have to "give back" to my company the extra in expenses I claimed over the year for the phone, or will Mr Taxman sort that out by taxing it accordingly for me... obviously the expenses have been paid now so I can't change that... just wondering the best way to correct the error?

Balls!

Thanks for your help guys!

[DaveB]

So then what does the first paragraph from the link I posted actually mean?



What does being exempt from charge mean especially as the line rental and cost of private calls has been paid by "the employer" ie my company?

Thanks for your help

It means that if YourCo Ltd buys a phone and gives it to you, you as the director or employee are allowed to use it for private use without having to keep track or private/business call details. The phone and any associated contract has to be in your companies name, not your personal name. You do not claim it on expenses since the company pays the bill directly. The phone is not yours, it is a company asset that you are permitted to use for private use.

[malvolio]

WHS. I assume you're not charging your mortgage and dog food bills to the company as well? Get it very clear in your head, Yourco and You are two entirely separate legal entities with their own assets, income and expenditure. Don't ever mix them up.