Allowable expenses inside IR35

[TheFaQQer]

Could the employee (the contractor) claim their mileage through their self-assessment, getting the tax back?

ie lets says it's a 20 mile round trip and you do it 200 times in a year - 20 miles * 45 ppm * 200 days = £1800

A bit like when a company pays less than the HMRC rate, you can claim the difference against tax.

Inside IR35 means no travel and / or subsistence expenses. An employee couldn't claim it, so it doesn't fall into the "you can claim back what an employee can claim back" exception either.

[malvolio]

Could the employee (the contractor) claim their mileage through their self-assessment, getting the tax back?

ie lets says it's a 20 mile round trip and you do it 200 times in a year - 20 miles * 45 ppm * 200 days = £1800

A bit like when a company pays less than the HMRC rate, you can claim the difference against tax.

Quick answer - No.

HTH.

[b r]

Could the employee (the contractor) claim their mileage through their self-assessment, getting the tax back?

ie lets says it's a 20 mile round trip and you do it 200 times in a year - 20 miles * 45 ppm * 200 days = £1800

A bit like when a company pays less than the HMRC rate, you can claim the difference against tax.

[northernladyuk]

Because it costs them a lot more, and the OP wouldn't have got their rate or anywhere near it but would be stuck with the non-incremented scale rate for the post.

Could also be a limitation on headcount.

[malvolio]

Just for clarity the link to the whole post is...

http://forums.contractoruk.com/publi...ml#post2394879

If it's near 2 years long why don't they use an FTC?

Because it costs them a lot more, and the OP wouldn't have got their rate or anywhere near it but would be stuck with the non-incremented scale rate for the post.

[northernladuk]

Just for clarity the link to the whole post is...

http://forums.contractoruk.com/publi...ml#post2394879

If it's near 2 years long why don't they use an FTC?

[cojak]

See here:

How will this affect the money in my pocket?

What about my expenses?

That's the bad news. Apart from direct cost of materials used in performance of the services; and expenses that would have been deductible if the worker had been the client's employee, you can't claim any expenses from the company. The point has been made to Treasury and HMRC that if you have any other expenses for your company then you have no means to pay these, but there has not been any acknowledgement of this problem. If your company only does public sector work, but has to pay for mobile phones, internet, insurance, or anything else then I cannot see how the company can legally do this.

[colanm]

I've recently taken up a contract role with a PSB and have been deemed inside IR35. It's a near two year contract and a good day rate so was worth taking (even being inside IR35). I understand that, due to being taxed at source, I won't be eligible for the 5% expenses if I was to set-up a PSC. In all I was very confused as to whether to set-up a PSC but could see no financial benefit (although I may have a few days of commercial work later in the year) so have gone through an Umbrella (initially).

Can I reclaim any expenses if I continue to get paid through the umbrella when completing my self-assessment at financial year-end? I understand I can get tax relief on pension contributions buy when I challenged HMRC on the issue of professional development & memberships and they wouldn't give me an answer (surprise!).

All help welcome!

Thanks.