Reply to: Daily rate increase vs. Expenses being paid?

[SueEllen]

How are "fixed un-receipted expenses" not simple?

What did you agree to instead?

The fixed expenses probably include VAT in them. So you are better off having a larger rate dealing with your own expenses.....

[Contreras]

Thanks for that. Shizzle sorting calls made: the consensus is that fixed un-receipted expenses are a bad idea. I'll request that the contract is amended.

Seems that there is great advantage in keeping things simple.

How are "fixed un-receipted expenses" not simple?

What did you agree to instead?

[northernladuk]

Thanks for that. Shizzle sorting calls made: the consensus is that fixed un-receipted expenses are a bad idea. I'll request that the contract is amended.

Seems that there is great advantage in keeping things simple.

You da man.

[Ames]

In this order do the following..
Read the contract thoroughly and try to understand it.
Call the agent back and get anything you don't understand clarified to the point that you understand
If you have questions about how your accounts will work with this set up call your accountant and get it clarified.
At this point you should fully understand your situation and will have answered all your questions along the way.

Up to you to sort your shizzle out, not us.

Is it going to get complicated? If you don't start putting some effort in to understanding the fundamentals of your contract the yes... Very...

Thanks for that. Shizzle sorting calls made: the consensus is that fixed un-receipted expenses are a bad idea. I'll request that the contract is amended.

Seems that there is great advantage in keeping things simple.

[northernladuk]

First post - Hello!

I have a contract in front of me now paying £X00 per day plus £60 fixed expenses.

Is this going to get complicated? Will I need to supply invoices?

Should I press for the expenses to be incorporated into the day rate?

Thank you in advance.

In this order do the following..
Read the contract thoroughly and try to understand it.
Call the agent back and get anything you don't understand clarified to the point that you understand
If you have questions about how your accounts will work with this set up call your accountant and get it clarified.
At this point you should fully understand your situation and will have answered all your questions along the way.

Up to you to sort your shizzle out, not us.

Is it going to get complicated? If you don't start putting some effort in to understanding the fundamentals of your contract the yes... Very...

[Ames]

First post - Hello!

I have a contract in front of me now paying £X00 per day plus £60 fixed expenses.

Is this going to get complicated? Will I need to supply invoices?

Should I press for the expenses to be incorporated into the day rate?

Thank you in advance.

[TheFaQQer]

If the expenses are disbursements you don't add VAT if not then you would charge VAT, further details found here:

https://www.gov.uk/vat-costs-or-disb...d-to-customers

Just send them the link and they shouldn't argue then.

Shouldn't being the operative word

[Kenny@MyAccountantFriend]

If the expenses are disbursements you don't add VAT if not then you would charge VAT, further details found here:

https://www.gov.uk/vat-costs-or-disb...d-to-customers

Just send them the link and they shouldn't argue then.

[Ticktock]

I suppose most companies are okay with it once it gets to someone in accounts who has a clue, but I had a discussion with a manager who sits next to me because he was moaning that "Some of these contractors are taking the piss adding VAT to expense claims".

I tried to explain, but he was having absolutely none of it as he just couldn't see the difference between his internal claims and their invoicing.

Why did the manager even see the expense claim plus VAT? If you needed him to approve the expense claim then you ask him to approve the £100 hotel bill at £100, and give him a copy of the bill which reads £100.

When you submit your invoice then you submit it at £100 and then add the VAT to your invoice total, along with everything else.

[vwdan]

I don't know by whom. There have been one or two posts on here where people have had trouble, but I wouldn't say that was the norm. I've never had an issue.

My invoice has two line items.
The first line is for my fees, the second line is for the expenses total (detailed on a second page).
These two lines are then sub-totalled, VAT displayed, and finally total invoice value. The expenses are simply part of my net charge, to which VAT is added.

I suppose most companies are okay with it once it gets to someone in accounts who has a clue, but I had a discussion with a manager who sits next to me because he was moaning that "Some of these contractors are taking the piss adding VAT to expense claims".

I tried to explain, but he was having absolutely none of it as he just couldn't see the difference between his internal claims and their invoicing.

[Ticktock]

Apparently is not that easy getting paid VAT on your expense claims, I've been told.

I don't know by whom. There have been one or two posts on here where people have had trouble, but I wouldn't say that was the norm. I've never had an issue.

My invoice has two line items.
The first line is for my fees, the second line is for the expenses total (detailed on a second page).
These two lines are then sub-totalled, VAT displayed, and finally total invoice value. The expenses are simply part of my net charge, to which VAT is added.

[TheFaQQer]

Apparently is not that easy getting paid VAT on your expense claims, I've been told.

I mean, being VAT registered in flat rate scheme, makes no possible to claim back the VAT charged for instance on accomodation. So if you invoice the hotel expense you paid (that includes VAT) to the client, and add VAT on top of that, some clients may refuse or make it difficult. But if you remove the VAT from the hotel, and put your VAT on the invoice, you're making a loss.

So not sure, obviously in this scenario better go for a rate increase I guess.

Depends on the contract - make it clear that expenses will be invoiced back and VAT added.

I've never had a client get it wrong - I pay the hotel £100 including VAT, I invoice £120 to the client and they pay it.

It's a question of making sure that everyone understands what they are agreeing to.

[AnotherGuy]

Apparently is not that easy getting paid VAT on your expense claims, I've been told.

I mean, being VAT registered in flat rate scheme, makes no possible to claim back the VAT charged for instance on accomodation. So if you invoice the hotel expense you paid (that includes VAT) to the client, and add VAT on top of that, some clients may refuse or make it difficult. But if you remove the VAT from the hotel, and put your VAT on the invoice, you're making a loss.

So not sure, obviously in this scenario better go for a rate increase I guess.

[TheFaQQer]

Depends on how often you are likely to incur expenses, and whether any rate increase is likely to offset that.

So, if it means an extra £10 but you might end up flying halfway round the world and footing the bill, then I'd take the expenses (subject to a policy being agreed in writing beforehand). If it means an extra £50 a day and you might have to stay in the Linton Travel Tavern one night every six months, then I'd take the rate increase.

[vwdan]

I'd take the Rate increase..

1) Allows more control over when/where you stay
2) removes an extra approval hoop to jump through
3) makes you a bit less employee like?

Exactly - the last thing I'd want is the client questioning my expenses.