Umbrella companies

treetrunks

Hi, sorry to hijack. Im just about to start my first contracting role through an umberella company and a little confused about the expences rules. In terms of petrol claims do i only need to keep a receipt or also a log of my mileage carried out every week?

Also for food can i only claim set meals from a restuarant or can it be my weekly shopping (but just the items that i consume as part of my working role).

My final question is that i will be also carrying out some hours for another company. Probably no more than 10 hours a month. If i bill them also through the umberella company then i have to pay the weekly fee again. Am i better off invoicing them and then filing a tax return at the end of the year?

SteProud

treetrunks wrote: »

Hi, sorry to hijack. Im just about to start my first contracting role through an umberella company and a little confused about the expences rules. In terms of petrol claims do i only need to keep a receipt or also a log of my mileage carried out every week?

Also for food can i only claim set meals from a restuarant or can it be my weekly shopping (but just the items that i consume as part of my working role).

My final question is that i will be also carrying out some hours for another company. Probably no more than 10 hours a month. If i bill them also through the umberella company then i have to pay the weekly fee again. Am i better off invoicing them and then filing a tax return at the end of the year?

Hi there, happy to help but like I always say, I work for an umbrella so i'm not impartial.

Re mileage our contractors are asked to keep receipts and log their mileage as its best practice to do so.

Re the food expenses. I'm afairad you can't claim for the weekly shop items (like bread, mayo etc to make lunches), but if you were to buy a sandwich at lunchtime you can claim for this. The basic theory is if you have had to go offsite to buy a meal or buy a meal on site then it is a legitimate business expense. if you are able to bring food from home then it is not. HMRC rules I'm afraid.

There is a bit more info on the HMRC website here:
http://www.hmrc.gov.uk/incometax/relief-travel.htm

Re your last question, its very much up to you. Its perfectly legal to do it that way but don't forget that the weekly fee your umbrella charges is also tax deductable as a business expense and once you complete a self-assesment form, you usually have to complete one every year after that.

For some people it can prove a false economy as the money they are saving from doing it themsleves is negated by the extra time and hassle of completing the paper work when you could be fee earning.

And mistakes can be costly too.

That is just my opinnion though. Doing it the way you suggested is compliant.

Hope that helps, shout if you have any other questions

treetrunks

Thanks for the help, starting to understand.