TAx code and expenses

Florentin

Is a limitation of claim expenses against Tax Code to consider when the payroll company make the weges calculation?

LittleVoice

Florentin wrote: »

Is a limitation of claim expenses against Tax Code to consider when the payroll company make the weges calculation?

Sorry. I don't understand your question. Could you re-phrase it, please?

Florentin

My payroll company told me that my earning is limited by the amount of expenses which I can claim.
As well they told me the amount expenses is limited by the tax code. Is this true?

InsideInsurance

Allowable expenses have nothing to do with your tax code as they are paid to you Gross

If you are talking about going through a PAYE Umbrella then its slightly more complex as the non-refunded expenses are deducted from your gross pay

Florentin

Non refunded yes, but are used to reduse the amount which is taxable.
They do not want to use all amount of minimum allowable expenses for calculation.
I believe all the expenses have to be taken on calculation: mean travel and refreshment.
Am I correct?

InsideInsurance

What is their reasoning for not allowing all the expenses?

Are these proper documented expenses or the flat rate, £10/day for subsistence, type?

Florentin

Flat rate: £10/day and meleage.

InsideInsurance

I'm not an expert on tax/umbrellas/hmrc etc

Certainly what I have seen repeated time and time again is that the "flat rate" scheme is only allowed between HMRC and Employers. What is paid to Employees (which you legally are) has to be actual cost but I know many umbrellas encourage people to say it was £10/day.

Never known anyone get unstuck with HMRC but have known two contractors get stuck when they claimed £10/day for a year or so and then the umbrella asked for all the receipts to confirm each day was at or above £10 and needless to say they didnt have them and the umbrella charged them.

You didnt say why they arent allowing full expenses though?

Florentin

I believe was a way to put money in their pockets.
Today I asked how they or software know to consider only £20 from my claim expenses; this was the momment when they told me will find onother way to calculate. And the result was £130 in top then before.
I think was the way to put in pocket because in my payslip have been writen: Expenses carried forward: £1230.