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View Full Version : trusting your accountant?? (re: accomodation claim)



thepanadol
20th September 2004, 10:19
Just started my limited company, and my accountant is saying I can also claim my accomodation in London, but is that true?!

I am currently living in address A, which is where my company is registered to. However, I am planning to move soon, but will continue to use address A for my company.

Now, my accountant is saying that if I do that, I can claim that off as an expense....which kind of confuses me, as I thought you can only do it if it is mon-fri accomodation only.

So should I trust him? Sometimes(or most of the times) I just don't trust accountants and lawyers that much. :(

malvolio
20th September 2004, 16:23
So why don't we all register our company's at some other address and reclaim the mortgage and insurances as business expenses?

You can claim travel from place of work to client location as a business cost. You can also claim accomodation if it is necessary to live there to do the job - including 7 days a week for something like a three month lease on a flat. I doubt you could claim your main residence.

You can get a new accountant - that would seem to be a good starting point...

4Contractors
20th September 2004, 16:50
You can only claim expenses for temporary accommodation, such as bed and breakfast, hotel or a flat rented for the purposes of business whilst away from your main home.

There is no way a contractor will be able to claim expenses on his main residence, especially if it is his registered company address.

The only expense that can be legitimately claimed on your main residence is use of home as office - was your accountant possibly referring to that ?

thepanadol
21st September 2004, 10:46
malvolio: that's why I asked about this kind of claim, as I am begining NOT to trust him, esp when I didn't thought u can claim the rent.

************: If all my personal bank statements and mobile phone bills are sent to my old address, would my old address be my main residence then? and maybe my accountant is referring my new home to be a home office, if that's the case, is it a legit claim then??

fiddleabout
21st September 2004, 11:50
Expenses are pretty clear - if you incurr an additional expense soley in the course of the contract you can claim it (subject to 24 month rule on travel and lodging) if there is no additionl expense you can't.

If you are maintaining premises A but need to rent premises B for use during the contract you can claim. I suspect you could only claim for B but it may be possible to reverse that - I simply don't know.

If that doesn't answer the question get back to your accountant and ask how you justify the claim - they should be able to give an immediate and clear explanation.

You really have not given sufficient detail to give any better answer (plus I'm not an accountant either).

4Contractors
21st September 2004, 12:01
thepanadol

I'm not entirely sure what the definition of a main residence is but normally I think it's where you are registered on the electoral role. I think you have to state whether or not a property is your main residence on your council tax declaration and certainly on any mortgage application. Bill delivery to an address is no indication of a main residence IMO.

If you are renting a property that is not your main residence then I see no reason why accommodation claims could not be made provided they fit into the 24 month rule outlined by Fiddle above. If you actually own the property, it may be possible to rent it back to your company but you would need to speak to a qualified accountant about this.

thepanadol
21st September 2004, 13:29
I think my accountant meant just claiming address B, which I will be renting...and both are being in London.

I will have to ask my accountant how to justify it, and what's the proof as being my main residence.

Hmm..so I suppose, if I still claim for it...what is the worse that can happened? Having to reversed the money at the end of the financial year when I do my tax? Or would my company be blacklisted?

Just that I am kind of getting conflict of information from what I read and what my accountant told me, which made me question if he is any good at all, or maybe it is one of those things that he can speak from experience.

fiddleabout
21st September 2004, 16:04
If you are using a qualified accountant I very much doubt that he will be encouraging you to make claims that cannot be substantiated.

The more usual problem is the reverse where you think it's ok to claim something and the accountant advises against it - they tend to be a pretty staid and conservative bunch.

At the end of the day though it is you who is responsible for signing off the accounts so make sure you get this clarified.

thepanadol
21st September 2004, 17:10
He is a qualified chartered accountant, so I suppose he would have his views towards different claims.

Good point tho, it seems to be in reversed that I am worried that my accountant is advising me to claim more which i am reluctant too, I guess I am a bit concern it as I am the one signing the papers.

I am always confused about expense claims...

Thanks heaps guys! :) I will update this thread once I speak to my accountant. :)