EXPENSES

If there’s one story that’s captured the public’s interest this year, it’s the furore surrounding MPs’ expenses. With everything from duck houses to a box of matches, wasps’ nest removal and mortgages on second homes seemingly having been claimed for, MPs are now having to be far more transparent over their claims – and pay back monies that could have been claimed over a significant time period. Most recently it was revealed that those who refuse to repay excessive or incorrect expenses claims could be forced to appear in public before a High Court judge to plead their case.

Of course, some of the most press coverage has been over the more bizarre claims (ice cube trays, mugs from the Tate Modern and cherry trees, for example). But it does raise the question: just what can you claim for from your employer, without falling foul of the tax man?

HM Revenue and Customs says that any expense that can be validly claimed should be “wholly, exclusively and necessary to carry out your duties”. This is – within reason – open to interpretation, and is not necessarily a set list of items, but rather dependent on the individual’s role. A good example would be a security company who employs dog handlers: while it might be perfectly valid for these officers to claim pet food or vets’ bills for their animals, that doesn’t mean the privilege is extended to anyone with pets!

Here is a list of expenses that an employer can pay without generating a tax charge:

Travel

•     You can’t claim costs of commuting to and from a regular place of business. But you can claim the cost if it is a temporary place of business, such as a work placement.

•    You can claim an amount for using your own vehicle for business purposes. This is 40p per mile for the first 10,000 miles and 25p thereafter.

•    You can claim train and plane tickets if accrued on business

Accommodation

•     There are fixed amounts you can claim for overnight stays depending on whether it’s in the UK or overseas (£5 UK, £10 abroad)

•     You can also claim for “incidental personal expenses” such as newspapers, telephone calls etc

•     Meals: you can claim for the “reasonable” cost of a meal when away on business. This is usually the difference between a meal at home and the price of eating out.

Working from home

•    It might not sound like much (and it isn’t) but if you work from home can claim the princely sum of £3 a week to cover the cost of electricity, gas and telephone bills (provided you can prove they were for business-related calls)

•    If you use a personal mobile to make business calls, you can claim for them but not for the monthly line rental. Again, you’ll need the evidence to prove it.

Professional fees

•     If you work in an industry sector that requires membership of a trade or professional body, then you can claim the costs of this. Also, if you subscribe to trade magazines that are required reading, then these too are covered.

•    There is also what is termed a ‘fixed deduction’ for expenses that are necessary to carry out a particular role. For example, a nurse can claim for stockings and shoes that she needs to buy to complete her uniform.

Miscellaneous

•     If your company operates a Cycle to Work scheme, your employer is obliged to provide breakfast for you in the workplace



 • for more details about expenses, contact the tax team on 01227 454627 or email tax@burgesshodgson.co.uk

TO DOWNLOAD A PDF OF THE EXPENSES FACTSHEET, CLICK HERE