Your browser isn't supported
It looks like you're using an old web browser. To get the most out of the site and to ensure guides display correctly, we suggest upgrading your browser now. Download the latest:

Welcome to the MSE Forums

We're home to a fantastic community of MoneySavers but anyone can post. Please exercise caution & report spam, illegal, offensive or libellous posts/messages: click "report" or email forumteam@.

Search
  • FIRST POST
    • Harrypods
    • By Harrypods 7th Jan 18, 2:29 AM
    • 6Posts
    • 0Thanks
    Harrypods
    Income tax deduction for personal phone used for work
    • #1
    • 7th Jan 18, 2:29 AM
    Income tax deduction for personal phone used for work 7th Jan 18 at 2:29 AM
    Hi all,

    Iím considering buying a new iPhone. I use it a lot for work (70%), but have to pay for it myself - I donít expense it.

    Can I claim the work portion against my income tax as a work-related expense? Iíve tried googling, but everything I find relates to tax issues if a person claims it through the company, which I donít.

    Also - I pay AppleCare (insurance), and I pay for the phone in monthly installments under Appleís upgrade programme. If I could claim partial tax deductions for the phone, would i claim tax or depreciation on the value of the phone at the point I purchased it, or just for the monthly installments paid in that year?

    Thanks for any help!

    H
Page 1
    • Harrypods
    • By Harrypods 7th Jan 18, 2:31 AM
    • 6 Posts
    • 0 Thanks
    Harrypods
    • #2
    • 7th Jan 18, 2:31 AM
    • #2
    • 7th Jan 18, 2:31 AM
    Iím also working out how I can subscribe to this thread.
    • Tom99
    • By Tom99 7th Jan 18, 4:12 AM
    • 985 Posts
    • 604 Thanks
    Tom99
    • #3
    • 7th Jan 18, 4:12 AM
    • #3
    • 7th Jan 18, 4:12 AM
    Does your employment contract say you have to provide and pay for a work phone?

    Will you be sacked if you don't provide a phone at your cost?
    • Pennywise
    • By Pennywise 7th Jan 18, 8:03 AM
    • 9,605 Posts
    • 17,661 Thanks
    Pennywise
    • #4
    • 7th Jan 18, 8:03 AM
    • #4
    • 7th Jan 18, 8:03 AM
    If your employment contract requires you to provide and use a phone, you can claim tax relief on only the EXTRA costs of works calls/texts etc. You can't claim a proprtion of total costs, i.e. fixed costs as they're not extra expenses - you'd be paying the contract whether or not you needed it for business.
    • agrinnall
    • By agrinnall 7th Jan 18, 1:48 PM
    • 19,139 Posts
    • 14,821 Thanks
    agrinnall
    • #5
    • 7th Jan 18, 1:48 PM
    • #5
    • 7th Jan 18, 1:48 PM
    As the cost of calls/texts is very likely to be zero as they'll be included in the contract there'll be nothing for the OP to claim.
    • TheCyclingProgrammer
    • By TheCyclingProgrammer 7th Jan 18, 3:03 PM
    • 2,982 Posts
    • 1,702 Thanks
    TheCyclingProgrammer
    • #6
    • 7th Jan 18, 3:03 PM
    • #6
    • 7th Jan 18, 3:03 PM
    Your employer can provide you with a phone tax free for mixed use but unfortunately I don’t think there’s any tax relief you can claim on a phone purchases by yourself. You also cannot reclaim tax on the line rental unless, again, the contract is in your employer’s name.

    You can claim tax relief on the itemised cost of business calls but only if these actually cost you anything outside your normal included minutes.
    • Harrypods
    • By Harrypods 7th Jan 18, 10:42 PM
    • 6 Posts
    • 0 Thanks
    Harrypods
    • #7
    • 7th Jan 18, 10:42 PM
    • #7
    • 7th Jan 18, 10:42 PM
    My question is less around the contract, and more the physical phone - which is from a separate retailer, deal, etc. to the contract.

    The phone is an iPhone I intend to buy myself direct from Apple. I do need a mobile smartphone for my work (I'm in sales), and do use it primarily for work - I can work out the percentages. My company doesn't provide phones, and are a US-based startup with a small UK presence so don't have corporate phone contracts here.

    I noticed @Pennywise noted I can't claim the fixed costs of the contract, but how about of the phone itself? Much of the gov.uk guidance also focuses on the contract, or a phone included in a contract, but not of the phone itself?
    • TheCyclingProgrammer
    • By TheCyclingProgrammer 7th Jan 18, 11:34 PM
    • 2,982 Posts
    • 1,702 Thanks
    TheCyclingProgrammer
    • #8
    • 7th Jan 18, 11:34 PM
    • #8
    • 7th Jan 18, 11:34 PM
    No you can’t claim for the phone. There is an exemption in place for an employer provided phone, not for claiming tax relief on a phone paid for personally.

    https://www.gov.uk/hmrc-internal-manuals/employment-income-manual/eim21779

    Couldn’t your employer provide you with a phone under some kind of salary sacrifice arrangement?
    • Harrypods
    • By Harrypods 8th Jan 18, 12:10 AM
    • 6 Posts
    • 0 Thanks
    Harrypods
    • #9
    • 8th Jan 18, 12:10 AM
    • #9
    • 8th Jan 18, 12:10 AM
    Nope, generally US startups see 25 days' holiday as a huge extravagance, let alone things like phone plans, cycle to work, childcare benefits, etc. etc. They hire an M4 corridor administration company to cover the mandatory basics (salary, workplace pension), and anything else is filed as 'too hard' and either expensed or ignored.

    Thanks for clarifying, TheCyclingProgrammer.
    • Harrypods
    • By Harrypods 8th Jan 18, 12:19 AM
    • 6 Posts
    • 0 Thanks
    Harrypods
    However, I see that the link you post again only relates to mobile phones provided by the employerr. not one provided by the employee.

    Even on the specific section on gov.uk (can't paste link as a newbie), despite the heading sounding promising, they assume the employee is expensing the contract, not the physical phone.

    The employee uses their own phone and you reimburse them
    If you only reimburse the monthly phone tariff, deduct and pay Class 1 National Insurance and PAYE tax through payroll. There are no additional reporting requirements.
    • TheCyclingProgrammer
    • By TheCyclingProgrammer 8th Jan 18, 1:39 AM
    • 2,982 Posts
    • 1,702 Thanks
    TheCyclingProgrammer
    That’s because there isn’t any tax relief for your personal mobile phone available.
    • 00ec25
    • By 00ec25 8th Jan 18, 7:15 PM
    • 5,762 Posts
    • 5,214 Thanks
    00ec25
    However, I see that the link you post again only relates to mobile phones provided by the employerr. not one provided by the employee.

    Even on the specific section on gov.uk (can't paste link as a newbie), despite the heading sounding promising, they assume the employee is expensing the contract, not the physical phone.
    Originally posted by Harrypods
    if the company reimbursed the employee for the cost of the phone then the phone is an asset of the company, not the personal possession of the employee. At which point the contract for the phone must be in the company name.

    you cannot have a phone that you own paid for by the company, that is simply not possible and hence it is not overtly stated as being allowable since that is a double negative, you do not list what is not allowable, you simply don't list it.
    • Harrypods
    • By Harrypods 8th Jan 18, 7:28 PM
    • 6 Posts
    • 0 Thanks
    Harrypods
    if the company reimbursed the employee for the cost of the phone then the phone is an asset of the company, not the personal possession of the employee. At which point the contract for the phone must be in the company name.
    But the company didn't reimburse me - that's the point. Everyone and everything seems to default to an initial position of the company paying for the phone and/or contract - which isn't the case here.


    D
    • 00ec25
    • By 00ec25 8th Jan 18, 7:38 PM
    • 5,762 Posts
    • 5,214 Thanks
    00ec25
    But the company didn't reimburse me - that's the point. Everyone and everything seems to default to an initial position of the company paying for the phone and/or contract - which isn't the case here.


    D
    Originally posted by Harrypods
    that is the point, if the company does not pay for it YOU HAVE NO CLAIM
    • Pennywise
    • By Pennywise 9th Jan 18, 8:49 AM
    • 9,605 Posts
    • 17,661 Thanks
    Pennywise
    But the company didn't reimburse me - that's the point. Everyone and everything seems to default to an initial position of the company paying for the phone and/or contract - which isn't the case here.


    D
    Originally posted by Harrypods
    That's because the point is to exempt monies paid to the employee by the employer for use of the phone. If there was no exemption, such payments would be subject to tax and NIC. You're looking at it from the wrong angle. At the end of the day, it's the employer's responsibility to provide the equipment etc needed by the employee, not HMRC or the taxpayer. If the employer pays the employee, then there's provision for those payments to be tax free.
    • FlameCloud
    • By FlameCloud 9th Jan 18, 9:58 AM
    • 1,792 Posts
    • 870 Thanks
    FlameCloud
    But the company didn't reimburse me - that's the point. Everyone and everything seems to default to an initial position of the company paying for the phone and/or contract - which isn't the case here.


    D
    Originally posted by Harrypods
    Given you seem to be disagreeing with everyone here, do you think it would be best if you paid for your own accountant to review?
    • SuperHan
    • By SuperHan 9th Jan 18, 7:18 PM
    • 2,023 Posts
    • 1,178 Thanks
    SuperHan
    No.

    To claim an employment expense, it must be wholly, exclusively and necessarily incurred in relation to your employment.

    As the phone is also used for personal calls, it is not wholly and exclusively for your employment (and arguably not necessarily). You have duality of purpose and so cannot claim the expense for tax purposes.

    (Looking for guidance on "duality of purpose" or "wholly, exclusively and necessarily" should find the info that you need).

    https://www.gov.uk/tax-relief-for-employees

    See paragraph under example 1.
    • TheCyclingProgrammer
    • By TheCyclingProgrammer 9th Jan 18, 7:47 PM
    • 2,982 Posts
    • 1,702 Thanks
    TheCyclingProgrammer
    Re: the above post, just to be clear, if the employer had provided the phone (either just the phone itself or the phone and a business SIM) it can be used for personal and business calls without there being a BIK. That’s why I suggested the salary sacrifice option.
    • Tom99
    • By Tom99 10th Jan 18, 6:22 AM
    • 985 Posts
    • 604 Thanks
    Tom99
    You can claim for the cost of calls whilst working at home so why not cost of calls from a mobile?

    "You can only claim for things to do with your work (for example, business telephone calls or the extra cost of gas and electricity for your work area).
    You can’t claim for things that you use for both private and business use (for example, rent or broadband access)."
    • Pennywise
    • By Pennywise 10th Jan 18, 7:49 AM
    • 9,605 Posts
    • 17,661 Thanks
    Pennywise
    You can claim for the cost of calls whilst working at home so why not cost of calls from a mobile?
    Originally posted by Tom99
    As said upthread, you can, but on a contract, most calls will be included in the free minutes, so there is no "cost of call", i.e. it costs the subscriber nothing to make the business calls.

    Of course, if any business calls were chargeable, i.e. to premium rate numbers, etc., then those would be claimable.
Welcome to our new Forum!

Our aim is to save you money quickly and easily. We hope you like it!

Forum Team Contact us

Live Stats

3,689Posts Today

9,313Users online

Martin's Twitter
  • RT @richlaing: @MartinSLewis Obviously spot poll but interested in the fact that 9% would opt out of donation. Interested to hear reasons w?

  • This is perhaps the most ridiculous tool I've seen online, it values your name based on what a sample of 500,000 ea? https://t.co/39sRBJrLt3

  • RT @RobiMous2: Yesterday I saved myself £30 a month by switching utilities and cancelling a sim no one in the family used anymore. Inspired?

  • Follow Martin