Contractor expenses

@if ®afiq

@if ®afiq

@if ®afiq

Soldato
Joined
3 May 2003
Posts
6,077
I'm thinking about leaving my permananet job and doing contracting and wanted to find out your experiences with expenses - more specifically from people who own a property in one city but rent and work in another. I suppose the main cost I want to claim back is rent - how easy is this?
 
Best thing to do is speak to a specialist. Head over to contractoruk and have a look around.
Depending on the conditions of your contract you may be able to claim it back from yourself (meaning less corp tax at year end).
Or, if you are lucky, you might be able to get the company you are working for including it in your daily / hourly rate (some do, some dont).

Are you looking to start your own company? If so, make sure you look at things like IR35 and Flat Rate tax scheme.
 
for short term accomodation (i.e. fixed term contract upto 2 years) you should be able to claim such things...merley paying a lower rate of tax. after 2 years you will run into IR35 problems etc.

feel free to email me and I will send you the link to my accountancy company that you could talk to.
 
Come on, is it really that secret? potentially damaging to business? :p
If they are good then surely you would recommend them :P

Us contractors need as much help as we can get when starting out these days!
 
that is a fact :)
but the option to email was there. thus getting my lazy contractors bum off of the internet and onto a far more "work related" looking email :)
 
Thanks guys - I'll check out the site Morba, I think I might have used it before.

The accomodation is short-tem (rolling every six months) and if I could claim that back it would make paying the mortgage in Brum much easier (and hopefully allow me to save some monies).

I was thinking about setting up my own company, but obviously I need to research which is the better option.

I'm going to hand my notice in on Friday and have four weeks before I finish, but need to make my mind up by the end of this week with which way to go.
 
Yes, you will still be paying it out from the money you earn. You cannot claim it back from HMRC, but instead get tax relief on it (still good as it comes off your bottom line meaning less money to be caught by corp tax)
 
same with all valid expenses. you cannot just claim the money, as it is your company money you are spending to start with :)

if the contract position means rented accomodation, best work out of the monies in still outweigh a staff position close to home etc. lots to think about.

i work it out on a basis of that if I couldn't reclaim anything at all what would my position be, anything else is just a bonus really :)
 
So I handed in my notice today and will be finishing here in four weeks - hopefully in time for the new financial year. I'ce check out SJD Accountants and they seem to be quite good - at least their site and information has impressed me.

Just have some things to clear up - when I sign up to the accountant, how often do I hand them the expenses form/receipts?
 
@if ®afiq said:
So I handed in my notice today and will be finishing here in four weeks - hopefully in time for the new financial year. I'ce check out SJD Accountants and they seem to be quite good - at least their site and information has impressed me.

Just have some things to clear up - when I sign up to the accountant, how often do I hand them the expenses form/receipts?
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usually monthly is a good option. anything over 3 months and they will be reluctant to process it (just because of work load nothing else)
 
SJD havent seen my receipts in the 6 months I have had them. However, they give you a spreadsheet for you to fill in each month (takes no time at all generally), then they will tell you how much corp tax / vat / paye etc to pay out.
 
I've been asked to set up an umbrella company to claim these by a high street retailer to reduce the taxable income (for providing IT support)...apparently they'll walk me through it and provide advice. If you're prepared to do that it will avoid IR35 problems.
 
lozza23_uk said:
for short term accomodation (i.e. fixed term contract upto 2 years) you should be able to claim such things...merley paying a lower rate of tax. after 2 years you will run into IR35 problems etc.

feel free to email me and I will send you the link to my accountancy company that you could talk to.
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IR35 has nothing to do with the length of contract, or overall length of time at a particular customer.

The problem is that after two years at the same place it is deemed a place of work, not a customer so you can no longer claim mileage or accomodation expenses. Thats seperate from IR35 though.
 
Oh and another vote for SJD, i use them too. They seem on the ball and my account manager is Lovely. Literally, thats her name :)
 
Stolly said:
IR35 has nothing to do with the length of contract, or overall length of time at a particular customer.

The problem is that after two years at the same place it is deemed a place of work, not a customer so you can no longer claim mileage or accomodation expenses. Thats seperate from IR35 though.
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i thought that you had less of a case if you spent too long at any one company?
obviously not.
 
I thought one of the IR35 'tests' was period of time of contract, so its not a case of being somewhere for 2 years, it can be the time of indication that you will be, eg you have been there 18 months and are given a 12 month extension, you know at 18 months that you would be there 2 years or more, placing you 'inside' IR35.

sr4470 - you dont setup umbrella companies any more, you can join a bigger company that trades as, but they arent as good as they used to be.
Better is to start your own company, you will make more money this way.
 
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