Claiming tax relief on journey to work

Silver_Starfish

My wife has been employed on a six month contractor contract. She is working in the same office every day, which is 20 miles from home. I appreciate that if she was an employee she would not be able to claim for her expenses in driving back and forth to work, but is it different because she is a self employed contractor? If so is there a mileage rate she can set against her income? Any help appreciated - thanks.

mister_t

I am not an accountant! If she is an independent contractor and therefore based at home she should be able to get tax relief on the expenses incurred at 45p/mile, claimable through the tax return. If she is a Ltd company then the company can just pay her at 45p/mile (or 20p/mile on a bicycle) and this would reduce her corp. tax liability.

I think it is also possible to add up all the costs of running the car e.g insurance/tax/etc and assign a portion of this to the business based on business/personal mileage ratio but I am not sure exactly how that works.

Google the 24 month rule which stops you claiming after 2yrs in one place. The definition of 'one place', and when it kicks in is a bit fuzzy.