Tax-free subsistence payments
Discussion
Assuming the new workplace qualifies as a temporary workplace then generally speaking reasonable housing, subsistence and travel costs qualify as tax free. So rent on a flat (including utility bills, council tax etc.), your food bills and travel to and from the temp workplace all qualifies.
My company draws a distinction where you don't have a set agreed rental/mortgage at your home address. I am currently living back at home (moved back a few months ago) until work is more stable/routine, whereby I pay my Parents rent/lodgings - my company are saying I don't qualify for tax free subsistence. I could understand that if I paid nothing, but not where I have a current agreement at my 'home' location - who I choose to rent from should be none of my Company's business surely?
So, have I got this right, you're living at home but you firm wants to post you somewhere else?
I don't see that HMRC would care about your current arrangements - it sounds like you're coming up against company rules. Even if you were paying nothing at the moment then your new arrangements would be an additional cost to you.
Or are they saying they can't pay you tax-free due to HMRC rules? They could always pay you nett of tax and then you could claim a tax refund from HMRC.
Bear in mind the company can set its own rules though. HMRC (my missus used to work for them) has more generous rules on mileage claims for taxpayers than it does for its own employees.
I don't see that HMRC would care about your current arrangements - it sounds like you're coming up against company rules. Even if you were paying nothing at the moment then your new arrangements would be an additional cost to you.
Or are they saying they can't pay you tax-free due to HMRC rules? They could always pay you nett of tax and then you could claim a tax refund from HMRC.
Bear in mind the company can set its own rules though. HMRC (my missus used to work for them) has more generous rules on mileage claims for taxpayers than it does for its own employees.
I believe that in cases like this HMRC have a rule somethiing like you would need to maintain a permanent residence elsewhere to qualify for the payment to be tax free. If you live with your parents you are not maintaining a permanent residence elsewhere. In the past when I've been paid these allowences I'd had to sign a declaration to that effect. Company never bothered checking 7 neither did HMRC.
GT03ROB said:
I believe that in cases like this HMRC have a rule somethiing like you would need to maintain a permanent residence elsewhere to qualify for the payment to be tax free. If you live with your parents you are not maintaining a permanent residence elsewhere. In the past when I've been paid these allowences I'd had to sign a declaration to that effect. Company never bothered checking 7 neither did HMRC.
He has a permanent residence - he lives with his parents. I'm not aware that there's any requirement to be paying for that accommodation.There is some stuff in the rules about itinerant workers who have no permanent home - they can't claim as they have to live somewhere so they're not suffering any additional costs. The OP is, as he doesn't pay anything to live at home.
So reading into it more, if I set up a formal rental agreement with my parents for an amount less than or equal to £4,250p.a. (i.e. the max amount permissible under the rent-a-room scheme) then they will have no tax liability, and I have will have a formal tenancy agreement which will satisfy the conditions of the form I have to fill out:
I certify that I am incurring additional expenditure on lodging away from my permanent residence and have a continuing liability for the expenses of maintenance of my permanent home residence situated in the United Kingdom at which I live whilst working away and my permanent residence is owned by me, (freehold or leasehold), or is a tenanted property for which by virtue of a written agreement on a commercial basis, I have a continuing financial obligation whilst working away. I also confirm that I do not receive rental income in respect of this property.
Funny really, as I've not bothered sorting my own place out again after moving back from the Middle East because I never knew where or for how long I was going to be anywhere due to work. Hopefully once this stabilises then I can find somewhere!
I certify that I am incurring additional expenditure on lodging away from my permanent residence and have a continuing liability for the expenses of maintenance of my permanent home residence situated in the United Kingdom at which I live whilst working away and my permanent residence is owned by me, (freehold or leasehold), or is a tenanted property for which by virtue of a written agreement on a commercial basis, I have a continuing financial obligation whilst working away. I also confirm that I do not receive rental income in respect of this property.
Funny really, as I've not bothered sorting my own place out again after moving back from the Middle East because I never knew where or for how long I was going to be anywhere due to work. Hopefully once this stabilises then I can find somewhere!
Mattt said:
I certify that I am incurring additional expenditure on lodging away from my permanent residence and have a continuing liability for the expenses of maintenance of my permanent home residence situated in the United Kingdom at which I live whilst working away and my permanent residence is owned by me, (freehold or leasehold), or is a tenanted property for which by virtue of a written agreement on a commercial basis, I have a continuing financial obligation whilst working away. I also confirm that I do not receive rental income in respect of this property.
Sounds suspiciously like the declaration I had to sign!
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