Mystery Shopping Thread 23 *PLEASE READ THE OP FIRST**PLEASE NO CLIENT NAMES OR FEES

polythenegirl

DPJames wrote: »

Weeg, what y'talking about man? This has been the most entertaining thread yet. We can't talk about tax and psychic banks all the time y'know.

What's a new thread going to do? I'm not going anywhere. Just get your boss to lighten up and remind The Gang to stick me on their ignore lists (again).

Maybe it'll make this place feel a little less agressive and encourage people to post? I know the last few weeks have certainly put me off posting (either asking questions or trying to help others)

dazza.mk

supermonkey wrote: »

I don't really view it like that. Fee & re-imbursement are near enough the same thing - payment to you for the mystery shop. Both would go on as income.

Agreed, my previous post wasn't very clear, you are being paid for via a meal. so therefore Reimbursement = Income, you have taken the assignment for the meal (as you aren't getting anything else out of it) therefore the personal benefit isn't incidental, the meal isn't an allowable expense and the full value is taxable.

Lil_Me_2

supermonkey wrote: »

I don't really view it like that. Fee & re-imbursement are near enough the same thing - payment to you for the mystery shop. Both would go on as income.

In the eyes of the tax man yes they are both income (but as I'll explain later you should consider them independently). The question is what you then class as an expenditure.

Your business is to make money, and to make a profit. So put your business hat on, and answer the question of why you took a job that you would not make any money on.

If you go out for a meal and there is no fee, then you are unlikely to be able to argue that taking that job was good for your business. However if you get a fee, (which you then pay a minimal tax on the profit on) then this is why you took the job.

The "benefit" of getting a meal is incidental, i.e you had to buy it to get the fee. If you cannot argue that the benefit is an incidental benefit then the tax man will expect you to pay tax on it. This still makes it a cheap meal out. But it's cheap, not free.

supermonkey wrote: »

Thanks - that's helpful. So I can't split the expense.

There are then three options.
1. State all as an expense (would make an overal loss).
2. Ignore all expenditure (would make a profit resulting in tax).
3. Any fees that are "reasonable" (eg where one meal has been purchased) are allowable expenses. Any assignments where I visted in with another and therefore the spend exceeds the fee are personal expenses. I then end up with a modest overal profit.

These all take into fuel expenses based on 45p a mile (as per april 2012). Not sure if this presents a problem in itself. Eg I have one assignment I travelled 55 miles so £24.75 which again exceeds the fee+reimbursement.

In terms of how you would record a meal out you really need to split the fee and the reimbursement. I certainly record all forms of income separately, much like I record all expenses separately. So on my spreadsheet for income I have Fee, Reimbursement, Special Income (mileage the company pay etc). Expenses I have Purchases, Mileage, Special Expenses (such as parking) and Printing [from memory that is].

Generally for a meal out, or somewhere where I buy something that cost more than the reimbursement I put the expense down as whatever the company are going to pay me. So if I get £30 for a meal out and I spend £35, I put my expenses down as £30 because it was my decision to spend more.

Exceptionally the only time I would consider putting more in this column would be if I am told I have to buy a specific food item, and the company reimbursement doesn't cover the cost. That is a real exception though, and I don't think I've ever actually done it.

Doing it this way means that you are left with paying tax on the fee minus the other expenses such as mileage, printing. So it's not much and not worth the potential hassle that the tax man would give you if he audited you.

I am interested to see how others would record such jobs though.

DPJames

dazza.mk wrote: »

you are being paid for via a meal. so therefore Reimbursement = Income

That's basically it nailed on the head. You take the job for the 'free' meal, so the meal is therefore payment, and taxable.

But in petrol stations etc, there's a fee AND reimbursement, so the fee is your payment, and that's taxable. Buying bits and bobs inside to assess service is part of the assignment, and these aren't taxable. (I think ) You had to buy the sweets/crisps to receive the payment, or something like that anyway. That's what the taxman said when I phoned him.

Aw here, I haven't got time for this. I needed to google a picture of loads of babies crying.

misssarahleigh

I wonder how accurate I am?

N.I.M

* gets popcorn and beer *

On a shopping note, can anyone see if the call needs to be recorded for mystery shoppers or am I just blind.

jen_br

N.I.M wrote: »

* gets popcorn and beer *

Pass that on over to the left hand side lol.mmmmm popcorn

dazza.mk

Lil_Me wrote: »

Generally for a meal out, or somewhere where I buy something that cost more than the reimbursement I put the expense down as whatever the company are going to pay me. So if I get £30 for a meal out and I spend £35, I put my expenses down as £30 because it was my decision to spend more.

Lil_Me see the link I posted above (and there are a couple of links within the page). In terms of meals/accommodation position is clear the costs are either business related or they are subsistence (and not allowable) there is no middle ground, so you can claim all or nothing (which is a different discussion).

My view on the rest of the point is that it is 'risky' you are specifying that part of your reimbursement you are getting a full 'personal benefit' and have declared it as non-taxable, in the event that you were ever investigated you are slightly on the back foot as to the rest of the purchase giving on an 'incidental' personal benefit and therefore being allowable.

One example doing a TNS large supermarket, do you make a separate visit and buy upto the reimbursement £x, or would you go and do a weekly shop and use the reimbursement £x as a discount on your shop...... both were required for the job, but much more difficult in version 2 to argue that the personal benefit is only incidental (and therefore an allowable expense)

dazza.mk

jen_br wrote: »

Pass that on over to the left hand side lol.mmmmm popcorn

Runs to get a pack of M&M's as well.

sparklysaver

I'm going on an HRMC workshop on Friday on Business Expenses and Capital Allowances for the Self Employed. I fully expect to get answers to ALL these questions.