Londoners, contacless on the tube - receipts?

[Morland]

Going forwards I'm just going to be using contact-less payments although HSBC don't appear to offer a business debit card that supports this so I'll have to continue claiming each individual journey I make.

My HSBC Business Debit card is OK for contactless - it's a new account, so a card issued about three months ago, but it has the contactless logo on the front and works fine for TfL payments.

[TheCyclingProgrammer]

My HSBC Business Debit card is OK for contactless - it's a new account, so a card issued about three months ago, but it has the contactless logo on the front and works fine for TfL payments.

Interesting, mine expires in February 2015 so maybe I'll get a new contactless one. As I already have a dispensation for travel expense reporting, being able to use the business card and save having to do expense claims and reimburse is even less admin.

[PerfectStorm]

Mallalieu v Drummond and duality of purpose. Although many now think Mallalieu v Drummond is bad law.

Yeah, I've read about the case. The thrust of the judges argument being "well you could wear the suits somewhere else, and they keep you warm anyway so it's not a business expense".

Well equally, I could bring my own packed lunch in and walk to work but I don't - all a bit silly really

[darrylmg]

Interesting, mine expires in February 2015 so maybe I'll get a new contactless one. As I already have a dispensation for travel expense reporting, being able to use the business card and save having to do expense claims and reimburse is even less admin.

Did you get a new one?
Do you pay for debit cards? I'm on HSBC Business Online Banking and I think I'd have to pay for a debit card.

I've become interested in contactless as I'm in London and don't have Oyster.
If i used contactless payment via debit card, do the individual trips show on your debit card statement, or do they get summarised at the end of the day?

[TheCyclingProgrammer]

Yes I got a new one, and it is contactless although I'm still currently using my personal card for travel costs.

One payment is taken per day but if you register your card online you get a full journey history.

[KayMan]

Hello folks, me again. So that issue was resolved ages ago I know, but now I have a slight different but related question. This might be a beginner question and I feel I should know the answer by now, but I dont.

My current client asks me to travel daily to a far location and claim for any travel expenses accordingly. They have given me the option to do so via the internal expenses process but I refused as I thought it would be too risky from an IR35 perspective. So instead I plan on invoicing separately for these expenses. However, being on FRS means I pay standard % on all sales receipts and so the VAT is then passed on to the end client. That is totally fine for services provided, however, for expenses, the issue is trickier, as travel on trains and underground is already VAT free. As such, charging VAT on top of that seems wrong? So if I sustained say £100 in travel fees (it would be £100 Net), would I invoice for £120 or £100, bearing in my the taxman would expect me to pay them VAT accordingly on all sales. Thanks for your help.

[MrMarkyMark]

Hello folks, me again. So that issue was resolved ages ago I know, but now I have a slight different but related question. This might be a beginner question and I feel I should know the answer by now, but I dont.

My current client asks me to travel daily to a far location and claim for any travel expenses accordingly. They have given me the option to do so via the internal expenses process but I refused as I thought it would be too risky from an IR35 perspective. So instead I plan on invoicing separately for these expenses. However, being on FRS means I pay standard % on all sales receipts and so the VAT is then passed on to the end client. That is totally fine for services provided, however, for expenses, the issue is trickier, as travel on trains and underground is already VAT free. As such, charging VAT on top of that seems wrong? So if I sustained say £100 in travel fees (it would be £100 Net), would I invoice for £120 or £100, bearing in my the taxman would expect me to pay them VAT accordingly on all sales. Thanks for your help.

Its not wrong. You charge VAT on all sales lines and pay HMRC their cut as per usual.

[Contreras]

Hello folks, me again. So that issue was resolved ages ago I know, but now I have a slight different but related question. This might be a beginner question and I feel I should know the answer by now, but I dont.

My current client asks me to travel daily to a far location and claim for any travel expenses accordingly. They have given me the option to do so via the internal expenses process but I refused as I thought it would be too risky from an IR35 perspective. So instead I plan on invoicing separately for these expenses. However, being on FRS means I pay standard % on all sales receipts and so the VAT is then passed on to the end client. That is totally fine for services provided, however, for expenses, the issue is trickier, as travel on trains and underground is already VAT free. As such, charging VAT on top of that seems wrong? So if I sustained say £100 in travel fees (it would be £100 Net), would I invoice for £120 or £100, bearing in my the taxman would expect me to pay them VAT accordingly on all sales. Thanks for your help.

The taxman only cares that you charge VAT on top of everything.

The amount is a contractual matter and needn't even need to bear relation to the original cost.

Being on FRS has no bearing on this, other than the potential for profit/loss is something for you to consider when agreeing rate and terms.

Technically, by using the travel you have "added value", hence the VAT. If you simply handed over an unused ticket for the client to use themselves, no value added hence re-charge at cost without VAT.

[radish2008]

Slightly sideways, but to clear up a myth.

You don't need recipts to claim an expense.

However you should have evidence of that expense. Obviously recipts are good evidence, but a log from TFL website is as good.

Less good, but still normally acceptable, is a line entry on credit card or bank statement, especially for smaller items and where there is little doubt what the item is.

In extremis a contemporaneous self written petty cash docket works.

For non vat registered or FRS traders, there's nothing else to worry about. For those on normal vat there's a need to evidence input tax, for which a vat recipt is the safest option, but HMRC can accept alternative evidence. Apart from fraud in known risk areas, eg carousel fraud and missing trader, it's quite rare theres a problem in practice.

This is my favourite post of all time.

[Lance]

So if I sustained say £100 in travel fees (it would be £100 Net), would I invoice for £120 or £100, bearing in my the taxman would expect me to pay them VAT accordingly on all sales.

other posters are quite right. You put VAT on everything you charge !or else!

I have a client who doesn't like to pay VAT on VAT so they insist that I deduct the VAT from expenses before before I claim. On FRS this equates to me giving them a discount, but then again I'm making 5.5% on VAT anyway. So all good.