It is some time since I have posted on this site and for that I can only apologise but I was hoping for some help with my late night bookkeeping.
I am constantly confused by the temporary workplace ruling and I was hoping someone could make things clearer!
I have a client who has previously worked through agencies. He has recently taken a PAYE position with a company on a 15 month contract but a huge distance from his home. My head tells me that he cannot claim expenses since he is based at one site only and this would be classed as regular commuting.
However, I still cannot get out of my head the 24 month rule and whether this could in fact be classed as a temporary workplace.
Please help
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Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
"A workplace is not a permanent workplace if it is a temporary workplace. A temporary workplace is somewhere the employee goes only to perform a task of limited duration or for a temporary purpose. The cost of travel to a temporary workplace is deductible."
Although the temporary workplace ruling does fit to some extent I am still concerned that this was a fixed term contract from the outset and the client was taken on to work at that site only. So my head tells me it cannot be justified for expenses
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Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
there are lots of examples of fixed term employees at a single workplace able to claim travel. For example, IT Contractors who work on a project basis perhaps spending six months in London then six in Edinburgh.
They are at one site for the duration of each fixed term contract and travel is allowable.
Of the links from Julies excellent primary link EIM32080 is the important one to get your head around.
Within the first 24 months the travel is allowable only where there is no expectation that the contract will be extended beyond the 24 months and where it is then the 40% rule comes into play.
All that the 40% rule does is mean that after 2 years, if you take a seven month break you are able to return to the site and claim travel for a very short period.
Also worth noting as a linked point here is an issue where HMRC try to pull a fast one.
In their original guidance there was a case shown of a contractor who always worked for different companies within the square mile. As such it was deemed that all contracts even though not for the same company came within the 24 month rule as the contractor would always be travelling to approximately the same place.
Some HMRC inspectors interpreted that as if you always worked in London (or Edinburgh, or Dublin, etc. etc.) which is a far wider remit than the quite legitimate guidance originally published which was quite specifically aimed at the somewhat incestuous relationship of the staff of the firms within a small area of London.
In conclusion though, provided that there is no expectation for your client to work beyond the 24 months then they will be ok claiming travel.
HTH,
Shaun.
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Shaun
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
I feel so confused about this as I contacted HMRC prior to your reply to try and gain some clarity and they were adamant that this was not a case where expenses could be claimed.
Despite my protest that this was only a 15 month contract, they advised that due to the nature of the site being the only workplace and that it was known to be from the outset that it would be deemed a permanent workplace.
In some ways, I feel happier as this was the advice that I had previously given my client but it seems such a huge grey area and so open to interpretation!
I am also aware that HMRC do not have the greatest record for accurate information!
Oh the confusion
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Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
if you want a different answer from HMRC just phone them back and you'll get someone else to chat with.
The way it works is that they have a big roullette wheel and when you call they just spin it and give you the answer that it stops on.
At least thats the way that I assume that it must work as I cannot think of any other explanation for some of their responses!
If you really want to play devils advocate, and you like the sound of a phone being put down on you phone and ask a question then when they give the wrong answer have an example from their own documentation prepared for them to clarify.
lol.
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Shaun
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
