Parasol are keeping my expenses!

[DirkSchemie]

I left parasol to work full-time, but I had nearly 400 quid in outstanding expenses.

"I have looked into this for you and until you have worked more hours, your expenses will remain on your account.
These expenses are not to be paid to you but to offset against tax."

Is this for real?

[original PM]

Yep - assuming you are talking schedule e expenses as opposed to client rechargable expenses

It works like this (very basically - ignoring statutory deductions and brolly fees)

Take the total invoice value

Remove any expenses you have incurred and pay them to you 'tax' free

The remainder of your invoice is taken as salary and is taxable.

So in your situation all of your invoices were paid as salary as your expenses were not in on time or the expenses you claimed were not in proportion to your salary and as such you now have an outstanding claim of £400.

As you are not going to create any more invoices you will therefore not be able to get your expenses paid back to you.

I believe that you may be able to get the expenses details from the brolly and apply to get them offset against your PAYE at the end of the year directly with HMRC but IANAA.

[NotAllThere]

You've already taken out the expenses as salary. Parasol aren't keeping anything.

[MPwannadecentincome]

what you should have done is locked down your account until all your expenses were in then released the lock so that the expenses would be taken into account.

Fine though if you are not worried about personal cashflow, would actually be much better if you could lock down say £1000 to offset against the next set of expenses you are just putting through the post before they pay it.

However, I have had an expense payment go through and still got some cash for them even though no new invoices were paid, it seemed that they realised there was some tax claw back somewhere so the money was paid to me. Could be because it was the second payroll payment in that month.

HTH