mileage expenses and 'normal' base locations
Discussion
i am a consultant working for a consulting organisation. I tend to work my days on client sites rather than in the offices of my employer. I've never worked with any client for any particularly long continuous period of time, but I have with my current one. My employer deducts the distance from my home to my nominal 'base' location of theirs (even if I never go there), so I can only claim mileage expenses if the client site is further away from my house than that. I am told however that I can use a P87 or self assessment to submit details of the deducted miles, and offset those against tax, IF and only if I've been going to that place for less than 2 years (it all gets a bit bendy if you've been going to the same place for longer). Can anyone confirm if this is OK? I need to dig back through the archives if so! Thanks
Hmm interesting
So let's say a PAYE employee fully work fr home but occasionally goes into a local (approx 90 mile return trip) office occasionally for meetings. Employer reimburses mileage tolls and parking. Some weeks it might require 2 days onsite and then no trips for several weeks.
Does the 2 year rule apply here ?
So let's say a PAYE employee fully work fr home but occasionally goes into a local (approx 90 mile return trip) office occasionally for meetings. Employer reimburses mileage tolls and parking. Some weeks it might require 2 days onsite and then no trips for several weeks.
Does the 2 year rule apply here ?
bmwmike said:
Hmm interesting
So let's say a PAYE employee fully work fr home but occasionally goes into a local (approx 90 mile return trip) office occasionally for meetings. Employer reimburses mileage tolls and parking. Some weeks it might require 2 days onsite and then no trips for several weeks.
Does the 2 year rule apply here ?
Not if your employment contract says you are based from home.....as mine does. I go into our UK office maybe 2 days per week for the last 6 years, but im still based from home and my fuel is paid to go into the officeSo let's say a PAYE employee fully work fr home but occasionally goes into a local (approx 90 mile return trip) office occasionally for meetings. Employer reimburses mileage tolls and parking. Some weeks it might require 2 days onsite and then no trips for several weeks.
Does the 2 year rule apply here ?
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. It is
possible for an employee to have 2 or more permanent workplaces. The employee will
not be entitled to tax relief for the costs incurred in travelling from home to any of the
permanent workplaces (see paragraph 3.29).
week, if it is on a regular basis, the workplace may still be a permanent workplace. It is
possible for an employee to have 2 or more permanent workplaces. The employee will
not be entitled to tax relief for the costs incurred in travelling from home to any of the
permanent workplaces (see paragraph 3.29).
bogie said:
Not if your employment contract says you are based from home.....as mine does. I go into our UK office maybe 2 days per week for the last 6 years, but im still based from home and my fuel is paid to go into the office
They may pay your fuel, but you (probably) should be paying tax on it. See above2 sMoKiN bArReLs said:
bogie said:
Not if your employment contract says you are based from home.....as mine does. I go into our UK office maybe 2 days per week for the last 6 years, but im still based from home and my fuel is paid to go into the office
They may pay your fuel, but you (probably) should be paying tax on it. See abovebut then my business miles are paid at 45p a mile for first 10K and 25p thereafter
Im responsible for EMEA&Russia region, trave anywhere on business at 48hrs notice, so my base location is home and Im on expenses when I leave the door....
bogie said:
2 sMoKiN bArReLs said:
bogie said:
Not if your employment contract says you are based from home.....as mine does. I go into our UK office maybe 2 days per week for the last 6 years, but im still based from home and my fuel is paid to go into the office
They may pay your fuel, but you (probably) should be paying tax on it. See abovebut then my business miles are paid at 45p a mile for first 10K and 25p thereafter
Im responsible for EMEA&Russia region, trave anywhere on business at 48hrs notice, so my base location is home and Im on expenses when I leave the door....
2 sMoKiN bArReLs said:
bogie said:
2 sMoKiN bArReLs said:
bogie said:
Not if your employment contract says you are based from home.....as mine does. I go into our UK office maybe 2 days per week for the last 6 years, but im still based from home and my fuel is paid to go into the office
They may pay your fuel, but you (probably) should be paying tax on it. See abovebut then my business miles are paid at 45p a mile for first 10K and 25p thereafter
Im responsible for EMEA&Russia region, trave anywhere on business at 48hrs notice, so my base location is home and Im on expenses when I leave the door....
Few people I know who drive say 20-30k business miles per year go out and do another 20k in their spare time. Our company are quite pragmatic about it, say its not worth their hassle to track business miles. So everyone in sales gets a fuel card and you keep your own records, sort your own tax out, the admin overhead is moved to the individual. The company just pays a fuel statement each month. For the sake of a few hundred quid a year of "free" fuel paid by employer as a benefit, its saving the employer lots of resource in running a complex mileage claim system and all that entails.
It might only scale to certain size companies though......Im sure some smart finance bods have it figured out when it makes sense for their company
I guess it depends on what constitutes a regular place of work?
In the example I gave, the employment contract states that the employee works fr home. The boss' office is in the US and nobody within the department has a regular office. The local (90 mile round trip) is one of two offices (the other being barcelona) that the employee might occasionally be required to visit. The employee provides consultancy to other employees at the location. Employee submits an expense claim which is reimbursed as it's a business expense.
All visits are a business purpose. Not a commute.
Does the forum feel that this should be a taxable benefit? The employee can choose not to visit the office and instead conduct the meetings remotely, for example.
In the example I gave, the employment contract states that the employee works fr home. The boss' office is in the US and nobody within the department has a regular office. The local (90 mile round trip) is one of two offices (the other being barcelona) that the employee might occasionally be required to visit. The employee provides consultancy to other employees at the location. Employee submits an expense claim which is reimbursed as it's a business expense.
All visits are a business purpose. Not a commute.
Does the forum feel that this should be a taxable benefit? The employee can choose not to visit the office and instead conduct the meetings remotely, for example.
bmwmike said:
I guess it depends on what constitutes a regular place of work?
In the example I gave, the employment contract states that the employee works fr home. The boss' office is in the US and nobody within the department has a regular office. The local (90 mile round trip) is one of two offices (the other being barcelona) that the employee might occasionally be required to visit.
All visits are a business purpose. Not a commute.
Does the forum feel that this should be a taxable benefit? The employee can choose not to visit the office and instead conduct the meetings remotely, for example.
Nope thats a business journey if your contract says you work from homeIn the example I gave, the employment contract states that the employee works fr home. The boss' office is in the US and nobody within the department has a regular office. The local (90 mile round trip) is one of two offices (the other being barcelona) that the employee might occasionally be required to visit.
All visits are a business purpose. Not a commute.
Does the forum feel that this should be a taxable benefit? The employee can choose not to visit the office and instead conduct the meetings remotely, for example.
Thats pretty much how I started until our UK office opened, but Im still not based there as its 4 hours away and im field based.
So it depends how mileage is paid as to how you sort the tax out. If you get fuel paid, or mileage. Private car/mileage or company car/fuel or private/fuel
Blown2CV said:
This all only triggers with locations you spend more than 40% of your working week in. Also it isn't buildings, it's towns.
Strictly speaking, it's journeys. In principle another building in the same town (same client, same contract) can count as a different location if the journey is substantially different. The example HMRC gives is a construction worker who spends 18 months building the north side of a bridge, then starts working on the south side so needs to get a ferry to work for the next 18 months. He's in the clear. But someone flying from Edinburg to Heathrow every Monday and switching to a job in Slough instead of Uxbridge might be regarded as making the same journey as before so fall foul of the rule.here's a question - how long a period do you have to spend NOT doing a particular journey every day (after the "knowing you'll be there for 2 years" thing) before HMRC acknowledge it's not your normal journey anymore and you can start doing it again?
I mean it's a bit daft this, it's hardly tax avoidance. I imagine it's to tackle scenarios where someone is headhunted for a specific role miles away from their home, and to sweeten the deal the employer says they can claim expenses to travel to and from work. Then it's tax free earnings. For me it's just reimbursement of genuine cost associated with being put on a project which I did not choose, as such! My base is 6 miles away; if i went there I'd drive and park for free, so anything above that should be claimable, i reckon.
I mean it's a bit daft this, it's hardly tax avoidance. I imagine it's to tackle scenarios where someone is headhunted for a specific role miles away from their home, and to sweeten the deal the employer says they can claim expenses to travel to and from work. Then it's tax free earnings. For me it's just reimbursement of genuine cost associated with being put on a project which I did not choose, as such! My base is 6 miles away; if i went there I'd drive and park for free, so anything above that should be claimable, i reckon.
ok seem to have run up against a problem here...
if you've done over 10k business miles a year i think it ceases to be fruitful to claim the home to base deduction unless you get way below 45p a mile from your employer for some or all of those miles through expenses. The miles over 10k I did get 45p each for, but HMRC decided I should have only received 25p, so the home to base claim brought us back up to evens.
if you've done over 10k business miles a year i think it ceases to be fruitful to claim the home to base deduction unless you get way below 45p a mile from your employer for some or all of those miles through expenses. The miles over 10k I did get 45p each for, but HMRC decided I should have only received 25p, so the home to base claim brought us back up to evens.
Blown2CV said:
here's a question - how long a period do you have to spend NOT doing a particular journey every day (after the "knowing you'll be there for 2 years" thing) before HMRC acknowledge it's not your normal journey anymore and you can start doing it again?
I mean it's a bit daft this, it's hardly tax avoidance. I imagine it's to tackle scenarios where someone is headhunted for a specific role miles away from their home, and to sweeten the deal the employer says they can claim expenses to travel to and from work. Then it's tax free earnings. For me it's just reimbursement of genuine cost associated with being put on a project which I did not choose, as such! My base is 6 miles away; if i went there I'd drive and park for free, so anything above that should be claimable, i reckon.
It wouldn't be tax free - if you're head hunted and change jobs and upon starting you know that new place is likely to be a regular place of work (40% of your time and over 24 months) it immediately becomes a taxable expense. Employers do offer that kind of deal usually as part of a relocation expense which I think has some tax reliefs for but it's very specific if there are.I mean it's a bit daft this, it's hardly tax avoidance. I imagine it's to tackle scenarios where someone is headhunted for a specific role miles away from their home, and to sweeten the deal the employer says they can claim expenses to travel to and from work. Then it's tax free earnings. For me it's just reimbursement of genuine cost associated with being put on a project which I did not choose, as such! My base is 6 miles away; if i went there I'd drive and park for free, so anything above that should be claimable, i reckon.
I've a slightly more subtle one in that my base office is 70 miles away but I work at home two days as we allow flexible working and then visit other locations inc base the rest of the time. The only place I spend 40% of my time is home. My employer is not keen to allow for expenses travelling to my base office but the tax man would be.
Became a bit of a non issue in the end when I started driving an all electric car as you can't claim any mileage, but I did wonder if I could enforce a change on my employer.
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