Reply to: Camper van or B&B as allowable expense living away from home

[tractor]

Maybe Im wrong but I though the poster in question meant he purchased the motorhome through his company and then got his company to charge him £490 a week for personal use (so to avoid the personal use issue). Or am I wrong?

£490 aint excessive for a weeks motorhome hire. Not sure about the winter, but in the summer you're looking at £750 minimum up to £1000.

They can indeed be quite expensive to rent short term.

[psychocandy]

I think the costs would have to be reasonable to escape scrutiny. £490 for 4 nights to use your own motor home seems a tad excessive. I am sure people will argue it but you have to think of it from HMRC's perspective. You can get a hotel for that so wouldn't pay those prices for a camper van.

Wouldn't you also have to declare that as income on your SA as well?

I am sure you could find someone charging that to hire one and you can argue you and LTD are different enough to charge market prices but I wouldn't be comfortable with that as an argument personally.

Each to their own.

Maybe Im wrong but I though the poster in question meant he purchased the motorhome through his company and then got his company to charge him £490 a week for personal use (so to avoid the personal use issue). Or am I wrong?

£490 aint excessive for a weeks motorhome hire. Not sure about the winter, but in the summer you're looking at £750 minimum up to £1000.

[northernladuk]

Must admit I like the idea of a motorhome.

So are you saying the cost of the motorhome was through the company? And if you use it personally the company charges you £490 a week to use it?

I think the costs would have to be reasonable to escape scrutiny. £490 for 4 nights to use your own motor home seems a tad excessive. I am sure people will argue it but you have to think of it from HMRC's perspective. You can get a hotel for that so wouldn't pay those prices for a camper van.

Wouldn't you also have to declare that as income on your SA as well?

I am sure you could find someone charging that to hire one and you can argue you and LTD are different enough to charge market prices but I wouldn't be comfortable with that as an argument personally.

Each to their own.

[psychocandy]

Could you move the narrow boat to another client at short notice? Yacht?

The motorhome is good, as no matter where the gig is, there will be a campsite nearby. These are about a £10 a night including power. So I have gone from 70 a night at hotels, plus about 25 food, to a tenner and couple of quid in the evening. Nothing if I camp wild. I take my canoe and bikes with me, so most evenings I am paddling or cycling. All free. As I said, if you can put the numbers down to Hector to prove it will end up you paying more corp tax to them, then they're happy. I pay £490 a week to the company for its use, which I get back, essentially...

We immediately got the VAT back, and £25,000 capital allowance. So, effectively, it cost much less then the £45k we paid. We can also, should we wish, close the company down in a few years and take the asset for not much money at all.

Everyone appears to be happy.

Must admit I like the idea of a motorhome.

So are you saying the cost of the motorhome was through the company? And if you use it personally the company charges you £490 a week to use it?

[Wanderer]

I can't see it being a problem Mon to Fri - but I assume HMRC would see it a weekend break for Sat/Sun. I intend to take a car and drive back home at weekends anyway.

I'd say go right ahead, do it and claim it.

If you pay to have your camper parked on site Sat and Sun but this is purely incidental to the primary business need then it's pretty much irrelevant if you stay there the weekend or not provided there isn't significant non business use. A similar situation would be if you rented a flat - you can't rent it Monday to Friday so it doesn't matter if you stay there on the weekends.

EIM31836 talks about accommodation, but I think it's pretty much the same principle:

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.

[Derben]

I have my own Motorhome (nothing to do with the ltd company)and can easily live in it whilst away. I thought about this as an option - but can't find any accurate infomation to say that I can claim the six months caravan site rental. I can't see it being a problem Mon to Fri - but I assume HMRC would see it a weekend break for Sat/Sun. I intend to take a car and drive back home at weekends anyway. Obviously, six months site rental is much cheaper than daily rates and is much much cheaper than hotels and property rental.

Anyone done this and managed to claim it as expenses ?

[Old Hack]

Could you do the same with a narrow boat? Or small yacht?

Could you move the narrow boat to another client at short notice? Yacht?

The motorhome is good, as no matter where the gig is, there will be a campsite nearby. These are about a £10 a night including power. So I have gone from 70 a night at hotels, plus about 25 food, to a tenner and couple of quid in the evening. Nothing if I camp wild. I take my canoe and bikes with me, so most evenings I am paddling or cycling. All free. As I said, if you can put the numbers down to Hector to prove it will end up you paying more corp tax to them, then they're happy. I pay £490 a week to the company for its use, which I get back, essentially...

We immediately got the VAT back, and £25,000 capital allowance. So, effectively, it cost much less then the £45k we paid. We can also, should we wish, close the company down in a few years and take the asset for not much money at all.

Everyone appears to be happy.

[Old Greg]

I bought a motorhome through the company on February. Before I did, I had a long conversation, recorded, with Hector whom, essentially, wanted to know if it would save the company money. As long as you use it solely for business, and any personal use is incidental, it is fine. Any personal usage has to be paid for at market rates (about £70 a day) and has to be recorded.

I have all of this documented and made sure I checked it out before I bought it.

As for comfort, I have a double at the back that is extremely comfortable, I have a large shower room, that I only use if I stay 'wild'. I have a 28" LED tv, and PS3 and cook all my own meals.

Prior to that, in the 6 months before, I had spent £2k a month on hotels and food.

After speaking to the tax woman, candidly, I got the impression, that if you are saving the company money, and can prove it, they are happy, as, ultimately, it means more corp tax for them.

We paid £45k after VAT. Speaking to a professional in the Motorhome field, he said that the rule of thumb is that they devalue by around 10% per year. So in 5 years, it would have lost around £20k, but that you'd save close to 10k a year on hotels etc.

Makes sense.

Could you do the same with a narrow boat? Or small yacht?

[Old Hack]

I bought a motorhome through the company on February. Before I did, I had a long conversation, recorded, with Hector whom, essentially, wanted to know if it would save the company money. As long as you use it solely for business, and any personal use is incidental, it is fine. Any personal usage has to be paid for at market rates (about £70 a day) and has to be recorded.

I have all of this documented and made sure I checked it out before I bought it.

As for comfort, I have a double at the back that is extremely comfortable, I have a large shower room, that I only use if I stay 'wild'. I have a 28" LED tv, and PS3 and cook all my own meals.

Prior to that, in the 6 months before, I had spent £2k a month on hotels and food.

After speaking to the tax woman, candidly, I got the impression, that if you are saving the company money, and can prove it, they are happy, as, ultimately, it means more corp tax for them.

We paid £45k after VAT. Speaking to a professional in the Motorhome field, he said that the rule of thumb is that they devalue by around 10% per year. So in 5 years, it would have lost around £20k, but that you'd save close to 20k a year on hotels etc.

Makes sense.

[Bacchus]

I bought a motorhome specifically for a contract and sold it immediately afterwards. We charged myco the difference in purchase price and sale price against tax and billed mileage in the usual way. Ended up taking a short holiday in it too, so paid a bit of BIK on the P11d.

It worked out a bit cheaper over all, but was a much better experience than some soulless B and B after a while - put your clean, ironed shirts in the wardrobe on Sunday, put some decent food in the fridge, and off you go.

Couldn't disagree more with BolshieBastard, far from needing you head read a decent motorhome should have all the creature comforts of home along with the knowledge that you know who the last person who slept in the bed was!! (one of my pet hates about hotels and B and Bs, brings out the OCD in me...)

[BolshieBastard]

I used to be at a client site where one contractor had bought an old VW ex AA van and converted it to 'live' in. It was a shed on wheels!

Seriously, if anyone wants to live in a campervan while on a contract instead of a B&B, they must be weak in the head! I like even basic creature comforts well more than what you get in a campervan!

[Old Greg]

In order to be a van it has to meet certain criteria. One of them in having a payload over a tonne I believe. In which case a camper van isn't a van for tax purposes I'm afraid. HMRC state:

"A van is a vehicle built primarily to carry goods or other loads which has a maximum laden weight of up to 3,500 kilograms." http://www.hmrc.gov.uk/vans/vans-info.pdf

Mal raised the point about duality of purpose, and I think this is where you'd fall down. I knew someone who tried to argue the same logic with a boat (lived on it whilst on contract) and HMRC disallowed it on investigation. Having a camper van would enable you to live in it, but you'd also have it available for private use.

HMRC do say that a motorhome isn't a car for VAT purposes though, so if the same holds true for BIK purposes then the annual charge could be based on 20% of market value. Worth looking into further!

So what if it's built as a van, and then converted?

[Clare@InTouch]

In order to be a van it has to meet certain criteria. One of them in having a payload over a tonne I believe. In which case a camper van isn't a van for tax purposes I'm afraid. HMRC state:

"A van is a vehicle built primarily to carry goods or other loads which has a maximum laden weight of up to 3,500 kilograms." http://www.hmrc.gov.uk/vans/vans-info.pdf

Mal raised the point about duality of purpose, and I think this is where you'd fall down. I knew someone who tried to argue the same logic with a boat (lived on it whilst on contract) and HMRC disallowed it on investigation. Having a camper van would enable you to live in it, but you'd also have it available for private use.

HMRC do say that a motorhome isn't a car for VAT purposes though, so if the same holds true for BIK purposes then the annual charge could be based on 20% of market value. Worth looking into further!

[Old Greg]

Now Old Greg that is an angle I had not thought of! Food for thought indeed

I have no idea if it's feasible. Just a question

[The Juggler]

Would converting a van be workable in terms of having a company van with 3k BiK? And then claiming campsite fees when working away at a contract?

Now Old Greg that is an angle I had not thought of! Food for thought indeed