Mileage expenses - home worker
Discussion
In a new role I have inherited an employee who works from home, but is in "the office" twice a week, every week. They have been claiming this on expenses as business mileage. Are there any situations where this is acceptable? I understand it would be dubious from a tax POV for both the business and the employee.
rsbmw said:
In a new role I have inherited an employee who works from home, but is in "the office" twice a week, every week. They have been claiming this on expenses as business mileage. Are there any situations where this is acceptable? I understand it would be dubious from a tax POV for both the business and the employee.
If the employee's contract states he/she is home based, then claiming mileage to/from the office is completely appropriate and acceptable. 
rsbmw said:
Contractual place of work is "the office"...this should be a fun chat.
Not really a fun chat. You just need to advise them of the facts and that as of close of business today you will no longer authorise such expenses.The fun starts when they try to carry on claiming and not accept your decision
Turns out, regardless of what the contract says about place of work, this wouldn't be an allowable expense;
Travel expenses: travel for necessary attendance: definitions: permanent workplace: regular attendance
Section 339(2) ITEPA 2003An employee regularly attends a particular workplace if the attendance is frequent, or it follows a pattern, or if the place is one at which the employee usually attends for all or almost all of the period for which he or she holds, or is likely to hold, that employment.
The proportion of an employee’s working time spent at a particular workplace is a factor in determining whether or not it is treated as a permanent workplace but it is not the only factor. Even if the employee attends the workplace only on one or two days a week, if it is on a regular basis, the workplace may still be a permanent workplace.
Apparently whilst it's only been 6 months or so that this has been regular (2 days a week), the employee has always had "the office" as their place of work in their contract and has always claimed mileage when travelling there. Where's the best place for them to get advice on their tax position, I expect HMRC could come after them for unpaid tax going back several years should they want to, however unlikely.
Travel expenses: travel for necessary attendance: definitions: permanent workplace: regular attendance
Section 339(2) ITEPA 2003An employee regularly attends a particular workplace if the attendance is frequent, or it follows a pattern, or if the place is one at which the employee usually attends for all or almost all of the period for which he or she holds, or is likely to hold, that employment.
The proportion of an employee’s working time spent at a particular workplace is a factor in determining whether or not it is treated as a permanent workplace but it is not the only factor. Even if the employee attends the workplace only on one or two days a week, if it is on a regular basis, the workplace may still be a permanent workplace.
Apparently whilst it's only been 6 months or so that this has been regular (2 days a week), the employee has always had "the office" as their place of work in their contract and has always claimed mileage when travelling there. Where's the best place for them to get advice on their tax position, I expect HMRC could come after them for unpaid tax going back several years should they want to, however unlikely.
I found this from an accounting and advisory company...
http://www.moorestephens.co.uk/MediaLibsAndFiles/m...
http://www.moorestephens.co.uk/MediaLibsAndFiles/m...
website above said:
If an employee’s permanent workplace is their home but they also regularly attend another workplace, this may also be considered a permanent workplace. For example, an employee may work at home for four days’ a week but attends the employer’s office once a week for meetings or to collect more work. In this situation the employee’s home and the of ce could both be considered permanent workplaces and travel between them would be ordinary commuting and therefore not allowable as an employment expense.
Looks your member of staff might well get bent over by the taxman, so to speak...rsbmw said:
Are there any situations where this is acceptable?
The one where you dont get a disenfranchised employee who leaves and you then have the time, money and effort of replacing them. Going in with 'your expenses are b
ks, you're not claiming this anymore' is going to get anyone's back uprsbmw said:
True, much better that both the employee and business continue committing tax fraud.
He didn't say that. For instance you might consider a cost neutral option of giving him a pay rise, in exchange for him not claiming the miles any more.Nothing illegal being done. Everybody happy. Home for tea and medals etc
rsbmw said:
True, much better that both the employee and business continue committing tax fraud.
I get the feeling that people management is something that's been put on you rather than something you've developed in to. Consider it from the employees side as well. They're being pulled into the office so would consider this a company request. Company requests presence has usually meant company pays the fuel bill. Company doesnt pay fuel bill gives the employee two choices, either pick it up themselves or not go to office.
They might be happy and completely understand the position. But if you just go straight in with no plan B you're going to come away from it worse off in the long run. Unless you already had a plan and havent included the details of that of course.
Munter said:
rsbmw said:
True, much better that both the employee and business continue committing tax fraud.
He didn't say that. For instance you might consider a cost neutral option of giving him a pay rise, in exchange for him not claiming the miles any more.Nothing illegal being done. Everybody happy. Home for tea and medals etc
It doesn't matter whether the employer minds the employee charging them for the mileage, if it's not an allowable expense then it is simply extra taxable income.
Or is that not correct?
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