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Tax treatment of expenses when claim involves expenses for others

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    Tax treatment of expenses when claim involves expenses for others

    Current situation - using a brolly and inside IR35. Working at a remote site for a couple of days on behalf of the client, so the expenses are allowable. Expenses are submitted via agency portal to client and reimbursed through agency to the Brolly. Brolly then pays them to myself before any tax calculations are run. In other words the whole value of the expense is paid into my personal bank account.

    However in my last trip I paid for lunch for both myself and a client permie. Submitted the expense and it was paid in full to the Brolly but now the Brolly is saying they can't pay the full amount to me, the expense for the permie's meal will only be paid to me after tax as they can only put in a tax claim for my part. This doesn't sound quite right to me, if the permie had paid for both they would have received the expense in full. In fact it is common practise that one person pays and submits the expense. Is it because I'm an employee of the brolly rather than the client?

    The tax element is so minor it isn't worth fighting over. However I want to be sure for future, in case I end up having to pay for a dinner for myself and a couple of the clients customers because I'm the only client representative at the time.

    #2
    Sounds very odd. If you're expenses of £400 have been approved by the client then you should get the £400 back, irrespective of the mechanism.
    The greatest trick the devil ever pulled was convincing the world that he didn't exist

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      #3
      Originally posted by LondonManc View Post
      Sounds very odd. If you're expenses of £400 have been approved by the client then you should get the £400 back, irrespective of the mechanism.
      No, it's more complex than that. We had a case 2 years or so back where the person was receiving expenses for the train fare from London to Newcastle alongside the Hotel but the umbrella was correctly deducting tax as his main office was Newcastle (as that was where he was 80% of the time)..

      I suspect the umbrella is actually right but until Lucy or someone who fully understands expenses comes along we won't get a definitive answer..
      merely at clientco for the entertainment

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        #4
        If they are chargeable expenses and the client has reimbursed them in full, regardless of what they are, then you should receive the money back in full.

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          #5
          Originally posted by lucyclarityumbrella View Post
          If they are chargeable expenses and the client has reimbursed them in full, regardless of what they are, then you should receive the money back in full.
          Lucy - Thanks for your answer. Sadly my brolly thinks that they can only claim tax relief on the portion attributable to me. In fact they have just asked me to check my previous expenses for any other cases. All for the cost of a sandwich

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