Umbrella company and T&S expenses

[lucyclarityumbrella]

Can I add some questions here. Lets assume it's not under SDC. I have asked an Umbrella company about what expenses I can claim and how that would work. They have been somewhat shy with sharing absolute information to me. But they have mentioned that I will under my new contract role be able to:
- Claim public transport expenses to and from my new office
- Claim daily subsistences costs like food and drinks
- Claim expenses on the cost of buying a new phone for my work. And I would receive 20%/40% back in the form of a tax refund (dependant on tax bracket I presume).

IF you are not deemed under SDC then the expense rules would be as they always were... you would need to show that you had multiple assignments with the umbrella and that you were employed under an overarching contract of employment.

The expense rules originally covered travel and subsistence, so to and from you temporary workplace would have been allowable, receipted costs of meals (not a simple allowance) whilst on assignment. Only the calls would be allowable with the mobile providing you could prove they were business calls, the cost of the phone would not be allowable.

HTH [emoji4]

[polagon]

IF you are not deemed under SDC then the expense rules would be as they always were... you would need to show that you had multiple assignments with the umbrella and that you were employed under an overarching contract of employment.

The expense rules originally covered travel and subsistence, so to and from you temporary workplace would have been allowable, receipted costs of meals (not a simple allowance) whilst on assignment. Only the calls would be allowable with the mobile providing you could prove they were business calls, the cost of the phone would not be allowable.

HTH [emoji4]

Thank you for clarifying this. Could you expand on "multiple assignments with the umbrella and that you were employed under an overarching contract of employment." - How would a longer 6 months contract with one employer fit into this.

[lucyclarityumbrella]

Thank you for clarifying this. Could you expand on "multiple assignments with the umbrella and that you were employed under an overarching contract of employment." - How would a longer 6 months contract with one employer fit into this.

OK previously in order to be able to claim expenses, it had to be your intention to have multiple assignments whilst working under the umbrella company, ie when one came to an end that you would undertake another with the umbrella company. If you did not fulfil this then expenses for tax relief purposes were not allowable. So in your case, if you had only one assignment with the brolly then this becomes a permanent place of work, 2 assignments and you would be travelling to a temporary workplace - hence expenses were allowable. The overarching contract makes the link between the temporary workplaces.

That said, as we haven't yet gone past the end of the financial year since the T&S Legislation was introduced, we have no idea how many contractors will be successful in submitting the claims on their SA.

[bikeman]

I am very confused by T&S claims. My brolly, Cloud9, says:

A ‘permanent’ employee... working in one place cannot be reimbursed his/her expenses of travelling to and from work, without having to pay tax on them. A ‘temporary’ employee... working in one place for the length of the employment, is in the same position.

But, a ‘permanent’ employee... whose job is to work on assignments in a succession of qualifying ‘temporary workplaces’ can be reimbursed those expenses, without having to pay tax on them. The purpose of the arrangements offered by an umbrella company is to be the employer for such employees, and to open the door to the employees being able to get the benefit of tax-free reimbursement of those expenses.

Lucy says I have to have an intention to work multiple assignments through the brolly, but what happens if I have this intention but fail to get multiple assignments?

[malvolio]

I am very confused by T&S claims. My brolly, Cloud9, says:

A ‘permanent’ employee... working in one place cannot be reimbursed his/her expenses of travelling to and from work, without having to pay tax on them. A ‘temporary’ employee... working in one place for the length of the employment, is in the same position.

But, a ‘permanent’ employee... whose job is to work on assignments in a succession of qualifying ‘temporary workplaces’ can be reimbursed those expenses, without having to pay tax on them. The purpose of the arrangements offered by an umbrella company is to be the employer for such employees, and to open the door to the employees being able to get the benefit of tax-free reimbursement of those expenses.

Lucy says I have to have an intention to work multiple assignments through the brolly, but what happens if I have this intention but fail to get multiple assignments?

Then you will owe some extra tax at year end.