 |
|
| CURRENT SECTION :: News | UK's most visited IT Contractor Site - 250k unique visitors March 2008 |
|
 |
Contractor’s Question I am currently in a contract that may get extended past 2 years. I believe there is a ruling that any contractor working in the same contract for over two years cannot claim back any travel or subsistence expense. Could you please explain this to me in terms of what expenses I can claim back? Answer by giant group plc . Under Section 61 Finance Act 1998, employees are entitled to deduct the expenses of travel to a ‘temporary workplace’. Section 339(3) defines a temporary workplace as a place that ‘the employee attends to perform a task of limited duration, or for some other temporary purpose’. In these circumstances a task of limited duration is one that is not expected to last more than 24 months. Once you accept a contract that will take you over 24 months at your current site then this location is deemed to be your normal place of work and travel and subsistence claims are no longer a tax deductible expense, even if you do not ultimately stay at that site for 24 months. For example: Mr Smith has an initial contract for 3 months which is then extended for 12 months. At the end of the initial extension his contract is extended for a further 12 months. The total contracted period is now 27 months and therefore Mr Smith cannot claim for travel and subsistence expenses from the acceptance of the second extension, even if the contract is terminated prior to Mr Smith completing 24 months. However contractors, just like any other type of employee, may claim for their travel costs when away from their normal place of work. Therefore if you are based in a regional office of your end client but are asked to attend a meeting at head office, the cost of your journey from the regional office to head office can be claimed as a tax deductible expense. Any expenses you incur that do relate to travel, such as professional subscriptions, training costs, business telephone or postage costs are not affected by the 24 month rule. Mar 7, 2008 Email this article Printer friendly page Previous Page
|
|
   |
||||||||||||||||||||||||
| All content © Contractor UK Limited | http://www.contractoruk.com/lists/?p=subscribe&id=1[Register for News Letter] | [Privacy Statement] | [Terms of Use] | [Top of Page] |