Reply to: HMRC now accept 'smartphones' qualify as 'mobile phones'

[Wanderer]

Well that sucks... with my current provider at least, every package I look at costs more EX-VAT for business than it does inc-VAT for personal. Is this some kind of rip-off of the "they can afford to pay more" variety?

Unless you've got a very good reason to stick with your current provider, I'd change to a new one that doesn't take the piss.

I wouldn't consider paying for for a tariff just because it's in the company name. Kind of defeats the purpose doesn't it.

If you can't get a decent deal then I guess there's nothing stopping your company buying a mobile contract free and giving it to you so you can get a sim only deal and pay the rental out of your own pocket.

[d000hg]

Well that sucks... with my current provider at least, every package I look at costs more EX-VAT for business than it does inc-VAT for personal. Is this some kind of rip-off of the "they can afford to pay more" variety?

Maybe I'll tell them my name is Mr d000hg Ltd

[d000hg]

Non company phone contracts tend to have 'all you can eat data' allowances whereas business contracts tend to be gigabyte specific packages.

They do? All the personal contracts I've been looking at have limits 100/200/500/1000Mb

[BrandNewCUKUser]

Non company phone contracts tend to have 'all you can eat data' allowances whereas business contracts tend to be gigabyte specific packages.

I use giffgaff.com as they do unlimited data. The do rolling monthly 'goodybags' which are effectively contracts. Easy to set up in the company name, billing a company card etc. Very reasonably priced.

It's owned by O2 so uses their network.

[BolshieBastard]

1) Buying a handset alone would be allowable for corporation tax relief through capital allowances, however if you are putting a personal SIM card into it then there would be personal use of an asset and therefore a benefit in kind tax charge on 20% of the asset value. PAYG top ups - the same as below, you may only claim the cost of the calls you can identify as for business use.

2) If the contract is not in the business name then you cannot claim relief for the line rental element, and the only claim you can make is for the cost of calls that you can attribute to business use. i.e. going through the bill each month and highlighting the business calls.

The best way is to get a phone contract in the business name however like you say it's a bit of a faff doing mid-contract. Definitely worth considering when you come to the end of your phone contract though, and in my experience there doesn't seem to be an awful lot of difference in the cost of a business contract as opposed to a personal one (certainly when factoring in the tax relief available).

Non company phone contracts tend to have 'all you can eat data' allowances whereas business contracts tend to be gigabyte specific packages.

[d000hg]

Maybe I'll talk to my provider and see if they'll make it easy for me in that case.

Thanks!

[ClearSky Accounting Dan]

1)If you buy a handset alone, or PAYG phone, what are the rules?
2)If the contract is NOT in the business' name, can you claim anything at all? If so, what?

1) Buying a handset alone would be allowable for corporation tax relief through capital allowances, however if you are putting a personal SIM card into it then there would be personal use of an asset and therefore a benefit in kind tax charge on 20% of the asset value. PAYG top ups - the same as below, you may only claim the cost of the calls you can identify as for business use.

2) If the contract is not in the business name then you cannot claim relief for the line rental element, and the only claim you can make is for the cost of calls that you can attribute to business use. i.e. going through the bill each month and highlighting the business calls.

The best way is to get a phone contract in the business name however like you say it's a bit of a faff doing mid-contract. Definitely worth considering when you come to the end of your phone contract though, and in my experience there doesn't seem to be an awful lot of difference in the cost of a business contract as opposed to a personal one (certainly when factoring in the tax relief available).

[Nixon Williams]

Sorry to drag up the old thread but it seemed silly starting a new one...



I already have a contract in my own name. Cancelling and setting up a new account in the business' name seems a bit of a faff especially since I fear business tariffs are not as competitive (and assume I can't change my personal tariff to be in the business name). Any general thoughts on how to proceed are welcome but two specific questions:

1)If you buy a handset alone, or PAYG phone, what are the rules?
2)If the contract is NOT in the business' name, can you claim anything at all? If so, what?

I realise that the HMRC rules are bit awkward but if you want to have a successful claim then they are the rules you should follow.

If you have no company phone and want to claim just for calls then you could submit a claim just for the calls, obviously without itemised billing this is not easy to do but if you do wish to pursue this then a best guesstimate should be acceptable, just keep your workings on what assumptions you have made in order to calculate the claim.

Alan

[d000hg]

Sorry to drag up the old thread but it seemed silly starting a new one...

So basically provided that ... the contract is in the company name and that the monthly payments are made from the company bank account

I already have a contract in my own name. Cancelling and setting up a new account in the business' name seems a bit of a faff especially since I fear business tariffs are not as competitive (and assume I can't change my personal tariff to be in the business name). Any general thoughts on how to proceed are welcome but two specific questions:

1)If you buy a handset alone, or PAYG phone, what are the rules?
2)If the contract is NOT in the business' name, can you claim anything at all? If so, what?

[mudskipper]

Just to say, SJD have responded and now sent updated P11D guidance to me (and presumably anyone else who got the wrong letter).

[Sockpuppet]

I think its a no then, as they are incapable of "transmitting or receiving spoken messages"

It's allowed. I use one and accountant has no problem with it. It's quite obvious that its a business expense as I need it to connect to e-mails when at clients sites as I don't use their equipment or networks.

I also used to use a data card which again was allowed. OK I've never been investigated but it would be a hard sell that its not allowed.

[mudskipper]

When they sent the advice last year it wasn't incorrect surely? It was correct at the time of sending but changed in Feb.

This was sent to me this week - so definitely incorrect. Have emailed Daniel forwarding the document and have requested to be sent the newsletter, although am surprised this didn't happen automatically.

[Danielsjdaccountancy]

Bit disappointed the SJD are sending incorrect advice then. They've also neglected to tell me about the increase in home office allowance. I pay an accountant so I don't have to keep up with the minutae of tax law myself...

Hi,

Thank you for the post. We issue newsletters at SJD which give updates on legislation changes. This includes as many changes that are applicable at the time.

Could you kindly PM or email daniel.mossatsjdaccountancy.com so I can ensure you are on the news letter distribution list.

Thank you

[northernladuk]

Bit disappointed the SJD are sending incorrect advice then. They've also neglected to tell me about the increase in home office allowance. I pay an accountant so I don't have to keep up with the minutae of tax law myself...

When they sent the advice last year it wasn't incorrect surely? It was correct at the time of sending but changed in Feb. Granted I haven't seen the new info yet. Just a question though, does anyone NOT put their smartphones through the books? I get what you mean about not being told though.

Interesting point about keeping up with tax law. I had a previous one man local outfit who failed in even the basics of doing my accounts so moving to the big guys was a breath of fresh air. Due this though I have never expected my accountant do do this for me. Guidance yes but I have always assumed it is part of my duties to question everything to get the best options. Maybe I am incorrect to have done this and should be expecting the accountants to do this.

I would be interested to know how many other people rely on their accountants soley to manage this and what are their experiences in their accountant doing this? Have I been letting them get away with it?

[mudskipper]

Bit disappointed the SJD are sending incorrect advice then. They've also neglected to tell me about the increase in home office allowance. I pay an accountant so I don't have to keep up with the minutae of tax law myself...