Mystery Shopping Thread 20 **PLEASE DO NOT MENTION CLIENT NAMES OR FEES ON HERE**

burnoutbabe wrote: »

the entire meal? I may have to order things i like and things i don't (and therefore don't eat beyond sampling one) so would i say "i didn't have any chips"

But if you need to order things you don't like on a reimbursemnet only job, why would you have taken it in the first place?

burnoutbabe wrote: »

The companies advertise the work as "enjoy a free coffee or pizza on us" on their websites - not "pay the tax man 40% of the value of your goods"

Although they generally specify in the t&c's you are responsible for declaring income to HMRC etc. etc. etc. , they're not going to deter prospective shoppers by pointing out you need to pay tax on your income are they?

burnoutbabe wrote: »

As i say, i am happy with my stance and to justify it to any tax inspection. if others want to pay more tax when they don't need to (in my opinion) then fair enough. we will never know 100% who is right as tax doesn't work like that, however my way means I pay less tax (and the right amount based on my work on doing tax returns and discussing with various iother tax professionals).

Good luck with it, I think you missed my point however, don't you think saying:
"I specialised in tax with a big 4 firm....." and (effectively) "reimbursement only meals isn't like a real job and you don't need to pay tax on it" is somewhat dangerous, giving you're setting yourself up as an authority and giving a (relative) authoratitive opinion on reimbursement only jobs? - when as you say there isn't definitive case law and individual assessments may vary depending on individual circumstances?

From the horses mouth (anthony and his department at HMRC)

Taxable Expenses

If the breif required you to purchase said products in order to be paid a fee, the products are 'incidental benifits' and can be classified as an allowable expense.

Reinbursment only

You cannot argue you have done the job for a fee. You have taken on the job and recieved goods for that job. Therefore payment in kind and is taxable.

If you can argue and prove that this was only done in order to gain access to fee paying jobs or build a reputation with the company, this will more likley depend on the strength of your argument. No set right/wrong to this, but based on individual circumstances.

Taking on reinbursment only jobs and classifying it as an expense is not allowed. If you do this purposly to lower your profit margin, he was clear in that it would be classified as Tax Evasion.

This is the answer I have received but please note this is not set in stone and very much open to interpretation.

I believe the difference in opinions is due to the fact there is no right or wrong answer for SOME of the situations we come across.

As previously said, i think it depends on your interpretation. i.e. i order a pizza and right it off as a taxable expense to get a fee. If the fee was £10 its clear I was doing it for the money. If the fee was £1, common sense would say i wouldn't go to all that trouble for £1 fee. But I would for the benifit of the pizza.

It's a grey area and in fairness i think it's down to the person who looks at your accounts if your ever audited.

So long as you can justify what you have done, and feel that your happy explaining why you have done that, then consider the matter closed.

Thanks Sarahleigh,

After all the tax discussion I think I'll join Yonk in his Zen forum...

Ommmmmmmmmmmmmmmm

yonk wrote: »

It's par for the course, just let it wash over you and in a few days, it'll all calm down. It happens on every forum I've ever followed...

Just take the info that interests you, ask the odd question and offer help if you can and let the rest of the posts pass by...:p

Think of it as Zen forum browsing...

Exactly my love. I got a rollocking when I first started on this thread, but I don't bang on about it constantly. !!!!! happens. The person having a go at me was probably having a bad day or PMS or PMT or whatever. Various other people have been told off at times, but they don't go on about it either.

Anyroad, has everyone had the email about spas and hotels from RA?

burnoutbabe wrote: »

If i had one company who i only did no fee jobs, well how is that different to say a pizza company giving me a free meal if i fill in a report card for them? thats not a job and you wouldn't pay tax if they did that. its probably pretty rare you do only no fee jobs for anyone.

That is exactly what I was getting at with my earlier post, to try to isolate the impact of reimbursement-only jobs. You either do them for the food, in which case is that really a "job" at all? Or you do them to develop your relationship with an agency which, despite people's assertions to the contrary, does work, even with typical self-assign agencies like RE.

If you're doing it to avoid tax somehow, then you know this and this is dishonest. If you have a belief that the expense is legitimate based on a reasonable understanding of what is going on, then if you are audited and the government disagrees, you can simply put things right.

It would certainly make things easier if agencies would offer tokens fees on all jobs rather than leave this reimbursement-only question one for us or the tax authorities to decide.