We consider your expenses with lot of care, so that you are not left exposed to the Taxman. Ganumbra receives and verifies your receipts, so you are safe when HMRC comes back.
In 2016, HMRC made changes regarding the expenses that you are able to claim, limiting the ability to process travel & subsistence expenses for tax relief purposes. It also limited the ability of the contractor to claim the tax relief on expenses if they are deemed to be under the Supervision, Direction and Control (SDC) of the end client.
Previously for an expense to be deductible from your earnings the expense must be incurred wholly and exclusively in the performance of your assignment.” However the terms “wholly” and “exclusively” prevented deductions for expenditure that serves a dual purpose, a business purpose and a non-business purpose. These would have been classed as non-chargeable expenses, which were out of pocket costs that were incurred as a direct result of your assignment work.
The ability to claim these expenses as tax relief still exists for umbrella contractors, but not at source. You will have to ensure that you are not under the Supervision, Direction or Control of the end client to HMRC and claim via P87 or self-assessment.
If you require any further assistance with this. Please get in touch with us, we will be happy to help you with.
HMRC now assumes that if you provide your services through an employment intermediary then you are subject to supervision, direction or control, (SDC), or the right of SDC by the end client.
Each engagement is now to be treated as a separate employment and each workplace regarded as a “permanent” workplace, so travel between your home and the workplace is regarded as ordinary commuting and any travel costs do not attract tax relief. For more information please refer here. click here
These are the expenses that your agency or client has agreed to reimburse you. Chargeable expenses will be added to your invoice value to your agency / end client. You will receive the full value of the expense if the expense is allowable for tax purposes. Please note if your agency / end client has agreed a fixed amount for expenses, then we will need the receipts for actual costs incurred on the assignment. If there is any excess paid than actual that will be subject to tax.