It's many years since I dealt with dispensations, and I'm aware that the rules changed in 2016/17
This relates to a Director with a trade.
Q1. HMRC manual says has to spend more than 5 hours qualifying travel, but then later says away from normal place of work (in this case home) for 5 hours, so I'm a little confused. https://www.gov.uk/hmrc-internal-manuals/employment-income-manual/eim05231
I remember reading that you need to get permission before the start of the tax year to report on payroll, If not does it go on P11D and is there any class 1A to pay?
Does evidence need to be provided and kept to show that the expense is legit?
Regarding mileage, if the vehicle has been included as an asset and CA claimed, I presume (well 99% certain) that mileage can't be used. Not sure if he wants to do that, but the last two months have included a mileage breakdown so just want to be doubly sure before letting him know.
-- Edited by Leger on Thursday 21st of January 2021 10:48:31 AM
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John
Any advice given is for general guidance and professional advice should be sought applicable to your circumstances.
If it's a sole director co then it's simpler that the business just pays for any costs, no need to involve the payroll process, unless I am misunderstanding what you're trying to do.
If the vehicle is owned by the co then the director cannot claim mileage, the company would be paying for all vehicle related costs (incl petrol) as it owns it. If the director has personal access to the vehicle then there may be a BIK issue to look at. If the director owns the vehicle then he can claim mileage but the co shouldn't have been claiming any CA.
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Jenny
Responses are my opinion based on the information provided. All information should be thoroughly checked before being relied on.
If it's a sole director co then it's simpler that the business just pays for any costs, no need to involve the payroll process, unless I am misunderstanding what you're trying to do.
Thanks Doug and Jenny
So basically I can stick the allowance down as subsistence and that's fine? Are there different rules for Directors and employees? My understanding is that for an employee (as per my op) it has to be reported as part of the payroll or on P11D if HMRC not notified before start of tax year (unless I've misunderstood that, which is possible )
If the director does claim the £5 a day allowance (it falls inside HMRC guidelines) do I need to see receipts for expenditure?
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John
Any advice given is for general guidance and professional advice should be sought applicable to your circumstances.
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