Reply to: Claiming for travel

[Rabotnik]

24 month rule aside...

You can claim a season ticket, even though it is available for personal use, as long as it is cheaper for the business.

Just to follow up on this, I asked another person at my accountant whether it was true I was supposed to get weeklies, and he said no, monthlies/annuals are fine! WTH, this whole time I have been queuing every week to renew my weekly card! Perhaps I am not cut out to be a contractor...

[SueEllen]

I thought the conclusion in a previous discussion on the topic was that Canary Wharf and City of London were the same if you were commuting from any distance away.

So Putney to Canary Wharf might be different from Putney to City, but Edinburgh to CW isn't substantially different from Edinburgh to City.

Yes that was the conclusion though the distance wasn't defined.

[mudskipper]

I like that one.

Particularly the part about Canary Wharf.

I thought the conclusion in a previous discussion on the topic was that Canary Wharf and City of London were the same if you were commuting from any distance away.

So Putney to Canary Wharf might be different from Putney to City, but Edinburgh to CW isn't substantially different from Edinburgh to City.

[psychocandy]

I thought the 24mth rule was specific to each client, not the geographical location! Oh dear, I have been claiming for weekly travel cards for the past year (accountant advised I get weeklies, since monthly implies I foresee being there for a long time apparently).

As I understand it, when you think you may exceed the 24mth rule, you should stop claiming travel expenses, so I suppose I shall have to have a word with my accountant about that. I would prefer to find a contract in Surrey next, but it will most likely be in London (maybe even an extension here in October).

HMRC-> you!

[SueEllen]

You missed one. What

I like that one.

Particularly the part about Canary Wharf.

[malvolio]

WCS or you could explain to the client you business costs have increased so have to alter your charges to suit and get it (or some of it) covered in a rate increase.

Here are some links to help.. the first mentions the 40% rule as well which is worth bearing in mind...

24 month rule for Contracting : Contractor Umbrella

24 Month Rule :: Contractor UK

everything you need to know about 24 month rule - Google Search

.

You missed one. What

[mudskipper]

24 month rule aside...

You can claim a season ticket, even though it is available for personal use, as long as it is cheaper for the business.

[northernladuk]

When discussing London due to the fact that people commute to it further away than other cities in the country and it's the largest city in the country, using the permie relocation argument isn't a good one to use.

For example if I lived in Reading and commuted to Ealing (zone 3) and then my next permanent job was in Oxford Circus (zone 1) it would be extremely unlikely that I would relocate as a permie. Even though getting to Oxford Circus would take me another 30-45 minutes and cost more.*

Likewise if my next job was in Canary Wharf (zones1/2) it still be unlikely that a permie would relocate. Even though the journey would take a longer time than going to Oxford Circus but cost the same.

The reason why it's not realistic to relocate around the SE is mainly house prices and rent prices.

This is just another example of HMRC rules being unrealistic and why the HMRC example for London can only use the City of London.

*In fact I worked with someone whose husband did this change and they didn't move.

Maybe I shouldn't have used London as I don't know what it is like to work there so question to those that do. Would you expect the 24 month rule to start again if you made teh change as SE describes? The fact your friends husband made the change without moving would lead me to think it wouldn't or is he really taking a hit doing this that us contractors would expect to claim for?

[SueEllen]

There is of course a grey area as with all HMRC's rules so we have had lots of debate on here, particularly about London. Many people will argue that a move from east to west or something could constitute a significant change in cost or time to travel. I think in HMRC's eyes this significant journey would be one that a permie would consider relocating to and this expenses is to help them for a period settle in a role before making the decision to relocate. 2 years is reasonable enough time to make that decision. That's my personal take on it though.

When discussing London due to the fact that people commute to it further away than other cities in the country and it's the largest city in the country, using the permie relocation argument isn't a good one to use.

For example if I lived in Reading and commuted to Ealing (zone 3) and then my next permanent job was in Oxford Circus (zone 1) it would be extremely unlikely that I would relocate as a permie. Even though getting to Oxford Circus would take me another 30-45 minutes and cost more.*

Likewise if my next job was in Canary Wharf (zones1/2) it still be unlikely that a permie would relocate. Even though the journey would take a longer time than going to Oxford Circus but cost the same.

The reason why it's not realistic to relocate around the SE is mainly house prices and rent prices.

This is just another example of HMRC rules being unrealistic and why the HMRC example for London can only use the City of London.

*In fact I worked with someone whose husband did this change and they didn't move.

[northernladuk]

I thought that the wording was something like "reasonably expect" rather than know.

So, if after 18 months, the client says "we're going to offer you a 9 month extension", then you stop claiming there rather than when you know it will happen, i.e. the paperwork arrives.

The worst situation is that after 18 months, you expect to be there over the 24 months so stop claiming. Then when you've been there 23 months, the client fails to get budget so you aren't going to be there after all. Can you then claim the expenses back that you didn't claim because you expected to breach the 24 months?? Can you ****.

I haven't seen that wording, all the guides say 'know'. Saying that I would take an indication from the client to extend as 'knowing' personally so the same as you indicate but guess you could argue you don't know until you get the paperwork. Some have tried to claim they didn't know for sure until they reached 23.9 months but I think that is stretching the spirt of the rule a bit too far.

[TheFaQQer]

You have to stop claiming expenses when you KNOW you will be over 24 months, not when you actually hit it. If you take two 9 monthers taking you 18 and then get offered another 9 monther you cannot claim any expenses for the 3rd stint even if you are only 18 months.

24 month rules have been discussed to death on here so as always I would suggest you try a search.

I thought that the wording was something like "reasonably expect" rather than know.

So, if after 18 months, the client says "we're going to offer you a 9 month extension", then you stop claiming there rather than when you know it will happen, i.e. the paperwork arrives.

The worst situation is that after 18 months, you expect to be there over the 24 months so stop claiming. Then when you've been there 23 months, the client fails to get budget so you aren't going to be there after all. Can you then claim the expenses back that you didn't claim because you expected to breach the 24 months?? Can you ****.

[northernladuk]

Don't let the 24 month rule influence your business for the sake of it. I chose to lose exes because of the quality of my current contract.

WCS or you could explain to the client you business costs have increased so have to alter your charges to suit and get it (or some of it) covered in a rate increase.

Here are some links to help.. the first mentions the 40% rule as well which is worth bearing in mind...

24 month rule for Contracting : Contractor Umbrella

24 Month Rule :: Contractor UK

everything you need to know about 24 month rule - Google Search

It does mention 'client site' a lot in these guides which is very confusing but as linked before the HMRC's examples clearly show an area effect not a client by client one.

There is of course a grey area as with all HMRC's rules so we have had lots of debate on here, particularly about London. Many people will argue that a move from east to west or something could constitute a significant change in cost or time to travel. I think in HMRC's eyes this significant journey would be one that a permie would consider relocating to and this expenses is to help them for a period settle in a role before making the decision to relocate. 2 years is reasonable enough time to make that decision. That's my personal take on it though.

[cojak]

Don't let the 24 month rule influence your business for the sake of it. I chose to lose exes because of the quality of my current contract.

[Rabotnik]

And that's a load of twaddle - you can get advanced travel upto the length of the contract provided it doesn't break the 24 month rule.

Ah I see, I will have to ask him about that. He's part of a popular contracting accounting firm, so I took his advice when I started contracting.

You have to stop claiming expenses when you KNOW you will be over 24 months, not when you actually hit it. If you take two 9 monthers taking you 18 and then get offered another 9 monther you cannot claim any expenses for the 3rd stint even if you are only 18 months.

24 month rules have been discussed to death on here so as always I would suggest you try a search.

OK, got it, cheers, my understanding was it was a simple contract >= 24mths then no travel expenses rule, and if you believe you will end up over 24mths then you shouldn't claim. I will have a read on it now, since I've obviously not understood it correctly. Would have done a search if I was unclear of course, I just spotted that comment about geographical location in this thread, I would have had no clue I was wrong otherwise!

[northernladuk]

I thought the 24mth rule was specific to each client, not the geographical location! Oh dear, I have been claiming for weekly travel cards for the past year (accountant advised I get weeklies, since monthly implies I foresee being there for a long time apparently).

As I understand it, when you think you may exceed the 24mth rule, you should stop claiming travel expenses, so I suppose I shall have to have a word with my accountant about that. I would prefer to find a contract in Surrey next, but it will most likely be in London (maybe even an extension here in October).

You have to stop claiming expenses when you KNOW you will be over 24 months, not when you actually hit it. If you take two 9 monthers taking you 18 and then get offered another 9 monther you cannot claim any expenses for the 3rd stint even if you are only 18 months.

24 month rules have been discussed to death on here so as always I would suggest you try a search.