Reply to: The 24 Month Rule in a nutshell

[malvolio]

I am hoping to get renewed on my current contract (ends 31st dec). If extended, and from the date of the extension is known I will cease claiming travel expenses as that will take me past the 24 month rule.

However my client has another site - 400 mile round trip and requires and over night hotel (e.g travel monday evening, overnight stop, work all day tues, then travel back).

In the last 6 month period of my contract I have done this trip only 3 times and would expect to make the same number of trips next year (6 month extension). As the other site would not be my ‘permanent site’ post 24 months, am I able to reclaim the expenses to the other site?

Yes. Its not your permanent workplace.

[gwynfryn]

Ad hoc visit to another site post 24 months

I am hoping to get renewed on my current contract (ends 31st dec). If extended, and from the date of the extension is known I will cease claiming travel expenses as that will take me past the 24 month rule.

However my client has another site - 400 mile round trip and requires an over night hotel (e.g travel monday evening, overnight stop, work all day tues, then travel back).

In the last 6 month period of my contract I have done this trip only 3 times and would expect to make the same number of trips next year (6 month extension). As the other site would not be my ‘permanent site’ post 24 months, am I able to reclaim the expenses to the other site?

[NobbyClark]

I hope he said a bit more than that because advice about keeping it below 40% isn't right as you've stated it. It's 40% over the entire period, not just from now on.

Yes that’s what I thought!

[northernladuk]

Excellent suggestions, I've cancelled the contract and they're open to me negotiating a new one. Interestingly my accountant finally decided to advise me to resign then negotiate a new contract but keep the days worked below 40%.

I hope he said a bit more than that because advice about keeping it below 40% isn't right as you've stated it. It's 40% over the entire period, not just from now on.

[NobbyClark]

Excellent suggestions, I've cancelled the contract and they're open to me negotiating a new one. Interestingly my accountant finally decided to advise me to resign then negotiate a new contract but keep the days worked below 40%.

[malvolio]

You might be better to flip it round (in a sense)

1. Scrap the contract
2. Produce a price list
3. Get them to raise a purchase order each time you work for them

Sure, you can "advise them when you are available", but if they raise a PO for each lecture, or even a call-off contract for, e.g. 10 lectures in a 6 month period, then you are invoicing to delivered purchase orders. If you do more than 10, then they raise a new PO.
It's a bit of extra work on their side (possibly), but it means you're not under an open contract to them and each PO is effectively a mini contract.

Beat me to it. But that would have almost exactly my own post.

[WTFH]

Yes, I see your point, although I dictate to the client when I'm available (it's an occasional lecturing role) so there's no control from the client other than offering me work when I choose to be available. Thanks for your input.

You might be better to flip it round (in a sense)

1. Scrap the contract
2. Produce a price list
3. Get them to raise a purchase order each time you work for them

Sure, you can "advise them when you are available", but if they raise a PO for each lecture, or even a call-off contract for, e.g. 10 lectures in a 6 month period, then you are invoicing to delivered purchase orders. If you do more than 10, then they raise a new PO.
It's a bit of extra work on their side (possibly), but it means you're not under an open contract to them and each PO is effectively a mini contract.

[NobbyClark]

If you have no end date - which is possibly not wise vis-à-vis IR35 and MoO at the very least - then your expectation is that you will be there more than 24 months...

Equally, if you take HMRC's viewpoint, if you have no end date then you are not there to deliver discrete piece(s) of work but as a long term resource, in which case you should be inside IR35 so expenses are not allowable and the 24 month rule an irrelevance.

More thinking required I feel.

Yes, I see your point, although I dictate to the client when I'm available (it's an occasional lecturing role) so there's no control from the client other than offering me work when I choose to be available. Thanks for your input.

[malvolio]

My contract has no end date, hence my difficulty in knowing how to prove when I 'expected' to continue past the 24 month point. In my case I'd lined up another contract with Client B which would have caused me to resign the contract with client A before the 24 month point. Unfortunately the work with client B has been delayed by several months so I'm pondering taking further work with client A. I'd always planned to terminate the contract with client A before the 24 month point but of course it would be difficult to prove that if I accept further work on an open ended contract!

If you have no end date - which is possibly not wise vis-à-vis IR35 and MoO at the very least - then your expectation is that you will be there more than 24 months...

Equally, if you take HMRC's viewpoint, if you have no end date then you are not there to deliver discrete piece(s) of work but as a long term resource, in which case you should be inside IR35 so expenses are not allowable and the 24 month rule an irrelevance.

More thinking required I feel.

[NobbyClark]

The rule is based on when you "become aware", but as you say that is a bit nebulous (gosh...). However, since you never work without a signed contract and that contract will contain start and end dates.....

My contract has no end date, hence my difficulty in knowing how to prove when I 'expected' to continue past the 24 month point. In my case I'd lined up another contract with Client B which would have caused me to resign the contract with client A before the 24 month point. Unfortunately the work with client B has been delayed by several months so I'm pondering taking further work with client A. I'd always planned to terminate the contract with client A before the 24 month point but of course it would be difficult to prove that if I accept further work on an open ended contract!

[malvolio]

Having studied this thread at length I thought I was fully clued up on the 24 month rule! Unfortunately my accountant has been unable to give me a straight answer on the 'awareness of exceeding 24 months' bit so I thought I'd get some opinions.

I've had an open ended 'from time to time' contract with Client A for the past 24 months which involved a 100 mile round trip so have obviously been claiming mileage. As my days worked were 50% of my total I was aware of the importance of not exceeding 24 months so haven't made myself available since July, without actually resigning from the contract, the intention being to find work somewhere closer. I have signed a contract with Client B but the work has been unexpectedly delayed until the New Year so am considering some days offered by Client A next week.

If I take the work I obviously wont claim mileage but it crossed my mind that it's difficult to prove when I was aware that I'd work past the 24 month point?

Am I jeopardising my previously paid expenses if I bust the 24 months due to the open ended nature of my contract with Client A?

The rule is based on when you "become aware", but as you say that is a bit nebulous (gosh...). However, since you never work without a signed contract and that contract will contain start and end dates, it's quite easy to point to a known or reasonably assumed termination date. And as I keep saying you work back from that point, not forward from today, and keep it under review. Once you are certain you will exceed the 24 month rule, whether it's 24 months at a set location or some combination of on-site and off-site working, then you stop claiming tax relief on expenses.

[NobbyClark]

Having studied this thread at length I thought I was fully clued up on the 24 month rule! Unfortunately my accountant has been unable to give me a straight answer on the 'awareness of exceeding 24 months' bit so I thought I'd get some opinions.

I've had an open ended 'from time to time' contract with Client A for the past 24 months which involved a 100 mile round trip so have obviously been claiming mileage. As my days worked were 50% of my total I was aware of the importance of not exceeding 24 months so haven't made myself available since July, without actually resigning from the contract, the intention being to find work somewhere closer. I have signed a contract with Client B but the work has been unexpectedly delayed until the New Year so am considering some days offered by Client A next week.

If I take the work I obviously wont claim mileage but it crossed my mind that it's difficult to prove when I was aware that I'd work past the 24 month point?

Am I jeopardising my previously paid expenses if I bust the 24 months due to the open ended nature of my contract with Client A?

[SteelyDan]

Pretty much. The 24 month rule hasn't changed.

There is some argument about London as the journey to get to various parts can vary quite a bit.

No it's not London, further north. Ta.

[ladymuck]

Using this thread as a reference, is this still the case (14.4 months), or have things changed?

I left location X end Dec 2017, and have the chance to go back there in September 2019, but with a different client; so same city but different role/client.

Is the clock reset & I'm OK to claim expenses again?

Pretty much. The 24 month rule hasn't changed.

There is some argument about London as the journey to get to various parts can vary quite a bit.

[SteelyDan]

The only way you can go back is to go to another contract at a significantly different location for 14.4 months* and then return.

Using this thread as a reference, is this still the case (14.4 months), or have things changed?

I left location X end Dec 2017, and have the chance to go back there in September 2019, but with a different client; so same city but different role/client.

Is the clock reset & I'm OK to claim expenses again?