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Predicament - what should I do?

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    Predicament - what should I do?

    Right, I'm in a bit of a predicament here, I'll try and keep it short and to the point:-

    My accountant has told me it's ok to claim 40p/mile and 9p/mile for fuel costs. Having checked this out on another forum thread and also done my own investigation work, I think my accountant may be wrong on this (9p or so is for a COMPANY car, not a private car).

    My accountant is also my mothers accountant, who she gets on very well with, he's also doing some work for a few of my contracting colleagues as well (who are also in the same situation now with the incorrect 9p/mile claim).

    I don't want to directly challenge him on his professional conduct as he is doing my company year end, etc at a very reasonable price. I do everything else myself, book keeping, payroll, mileage logbook/expenses etc (that part is easy).

    I've spent 10 months claiming this 40p + 9p per mile, approx 200 miles per month. How can I go back and correct this as I've been paying my mileage expenses monthly out my company account. I have the log in excel so I can just delete the 9p column and it will give me the correct total, but how would I fix this in my books? I don't want to ask my accountant this as I've already discussed this with him and he is adamant that it is fine to claim this 9p extra. In all honesty it's a bit worrying that this mistake can actually take place by someone in the profession, but everything else so far he's been spot on with.
    The cycle of life: born > learn > work > learn > dead.

    #2
    dejavu

    Comment


      #3
      Phone another accountant and query them on this and then talk to your current accountant and say that another accountant you know/work with/etc is adamant that this cannot be claimed and could he provide you with references to the HMRC site and explain how it all works to set your mind at rest.

      At the end of the day you are paying him to do your year and and provide you with advice, he should not be upset that you want to verify his advice is correct and that you are getting what you pay for. Also bear in mind that if the HMRC have any problems with this claim they will go after you and not your accountant.


      As for bookeeping you can either deleted the column and pay back that extra 9p/mile or class the extra money as wages/divi/directors loan

      Comment


        #4
        Incidently what are the consequences of claiming incorrect amounts, do HMRC simply make you pay it back, or are there fines etc involved? I'm an honest person and will be sorting this out, but surely it must have happened to people in the past, how do HMRC deal with it? Does it even get noticed?
        The cycle of life: born > learn > work > learn > dead.

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          #5
          I would try and avoid Bubba if I were you...
          "If you can read this, thank a teacher....and since it's in English, thank a soldier"

          Comment


            #6
            If you haven't finalised your accounts for the past 9 months nothing to worry about yet.

            Comment


              #7
              Originally posted by chris79 View Post
              Incidently what are the consequences of claiming incorrect amounts, do HMRC simply make you pay it back, or are there fines etc involved? I'm an honest person and will be sorting this out, but surely it must have happened to people in the past, how do HMRC deal with it? Does it even get noticed?


              Just make an adjustment in your year end figures before its been submitted it should be fine, ultimatly the tax man's only bothered that you pay the correct ammount.

              Never hear of the 9p a mile before on top of the 40p a mile milage allowance, maybe I need to change my accountant
              Some people are like slinkys, totally pointless but the thought of pushing them down a flight of stairs never fails to put a smile on your face.

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                #8
                As I understand it, there's nothing stopping you paying £100 per mile in mileage, just that only 40p of it is allowable as tax free. So in other words, the extra 9p's worth will become part of your income and you'll have some extra tax to pay at self-assesment time. It doesn't affect the company's books, as the company can pay you whatever it likes.

                But I am not an accountant, and you should ask a real one. Either that or get your accountant to show you his evidence, post it here for us to see, and let all the other accountants know that they're doing it wrong.
                Will work inside IR35. Or for food.

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                  #9
                  Surely the 9p per mile is VAT and is deducted from your VAT return. You don't pay that to yourself directly.
                  Too close for missiles, I'm switching to guns.

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                    #10
                    Well I called my accountant and just put it to him, said I had discussed it with some other contractors and that they had been told they were only allowed to claim 40p/mile.

                    I also contacted HMRC who confirmed this.

                    My accountant is going to look into this and get back to me tomorrow.
                    The cycle of life: born > learn > work > learn > dead.

                    Comment

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