Lodger as A limited company

Crowmo

I work as a locum via a limited company and genuinely do half my shifts near my home and the other half near my parents in law 50 miles away.
i do stay at my parents in law and give them money for general lodging etc for nights I do shifts there.
could the limited company pay for these
lodgings costs as the travel and accommodation is genuinely 100% for buisness( would not go there otherwise)
then my parents in law could claim up to 7,500 tax free in terms of rent a room relief?

thanks in advance 

Crowmo

Thanks
 But are not accommodation costs and allowable expense when travelling for buisness?
the accommodation costs are allowable if a hotel or air bnb or short term lodgings surely?
thanks again 

Grumpy_chap

AIUI, mileage to the "away" work plus accommodation / subsistence where necessarily incurred can be claimable as valid business expenses.  However, if the "away" work is only 50 miles, many companies would expect staff to make that trip in one day so the accommodation / subsistence is not then necessarily incurred.

caprikid1

"work is only 50 miles"... @45p per mile business rate x 10 days = £450 lodgings could work out cheaper and he may work long days also

mybestattempt

Crowmo said:

Thanks
 But are not accommodation costs and allowable expense when travelling for buisness?
the accommodation costs are allowable if a hotel or air bnb or short term lodgings surely?
thanks again 

I think perhaps you are confusing what is an allowable deduction from your taxable income/salary from the company for your travel and accommodation costs as a locum who is a director/employee of the company, with what is an allowable deduction for the company. 


My view is that if the company paid your in-laws you, as an individual, would be taxable on the whole amount but you, as an individual, could only claim as a deduction from that amount, the costs incurred wholly, inclusively and necessarily in the performance of you duties as a locum who is a director/employee of the company.

It's perhaps debatable, but I would take the view that you aren't performing any duties as a locum when you stay with your in-laws, it's simply a convenient way of meeting your personal/human need for food and a bed for the night, so no allowable deduction. 

DullGreyGuy

Crowmo said:

I work as a locum via a limited company and genuinely do half my shifts near my home and the other half near my parents in law 50 miles away.
i do stay at my parents in law and give them money for general lodging etc for nights I do shifts there.
could the limited company pay for these
lodgings costs as the travel and accommodation is genuinely 100% for buisness( would not go there otherwise)
then my parents in law could claim up to 7,500 tax free in terms of rent a room relief?

thanks in advance 

If the in-laws weren't living there, what would you do?

Are the shifts on consecutive days so you are saving on travel costs or are they on separate days so still incurring 100 miles travel each time?

How long have you been working at this place? How long left on the contract?

Crowmo

DullGreyGuy said:

Crowmo said:

I work as a locum via a limited company and genuinely do half my shifts near my home and the other half near my parents in law 50 miles away.
i do stay at my parents in law and give them money for general lodging etc for nights I do shifts there.
could the limited company pay for these
lodgings costs as the travel and accommodation is genuinely 100% for buisness( would not go there otherwise)
then my parents in law could claim up to 7,500 tax free in terms of rent a room relief?

thanks in advance 

If the in-laws weren't living there, what would you do?

Are the shifts on consecutive days so you are saving on travel costs or are they on separate days so still incurring 100 miles travel each time?

How long have you been working at this place? How long left on the contract?

thanks for input.
to clarify.

being able to travel to that side of london ( yes the 50miles is mostly M1/M25- so in rush hour would be a horrendous round trip) so overnight accomodation has been 100% neccessary given the hours I work- allowed me to increase income by at least double.
i would maybe have to had look at Airbnb/hotels but these in london are not cheap and the inlaws would be much more cost effective.
the shifts are never long term,no contract all ad hoc, sometimes consecutive.sometimes not.
if there was no shifts I would not travel and stay so only travel and accomodation for buisness purposes.
the point is i could pay a random Airbnb or pay my inlaws to get same outcome for me 
so should be expensable to buisness right?
thanks

Inbetweeners

I mean with all your 'surely' and 'right' you have all the answers no?

What does your accountant say about your attempted tax dodge?

Bookworm105

Crowmo said:

DullGreyGuy said:

Crowmo said:

I work as a locum via a limited company and genuinely do half my shifts near my home and the other half near my parents in law 50 miles away.
i do stay at my parents in law and give them money for general lodging etc for nights I do shifts there.
could the limited company pay for these
lodgings costs as the travel and accommodation is genuinely 100% for buisness( would not go there otherwise)
then my parents in law could claim up to 7,500 tax free in terms of rent a room relief?

thanks in advance 

If the in-laws weren't living there, what would you do?

Are the shifts on consecutive days so you are saving on travel costs or are they on separate days so still incurring 100 miles travel each time?

How long have you been working at this place? How long left on the contract?

thanks for input.
to clarify.

being able to travel to that side of london ( yes the 50miles is mostly M1/M25- so in rush hour would be a horrendous round trip) so overnight accomodation has been 100% neccessary given the hours I work- allowed me to increase income by at least double.
i would maybe have to had look at Airbnb/hotels but these in london are not cheap and the inlaws would be much more cost effective.
the shifts are never long term,no contract all ad hoc, sometimes consecutive.sometimes not.
if there was no shifts I would not travel and stay so only travel and accomodation for buisness purposes.
the point is i could pay a random Airbnb or pay my inlaws to get same outcome for me 
so should be expensable to buisness right?
thanks

you need to talk to your accountant
just because you have a Ltd does not necessarily mean your travel and accommodation costs are claimable.
the overarching principle is that you must be going to a temporary workplace for a task of limited duration 

although you are on locum work, it appears you have 2 normal places of employment: near home and 50 miles away. It appears, at face value, you simply have 2 part time jobs?
Travel to either could be classed as ordinary commuting since there is a clear pattern to and predictability of the workplaces.
Potentially, although I assume subject to a contract termination date, neither workplace is "temporary" and therefore may not be allowed as travel and subsistence costs at all.

what do you class as your normal place of employment?
if you claim it is your home and therefore you undertake zero "ordinary commuting" you need to make sure your accountant is very happy with that position as it has significant repercussions .

Crowmo

Bookworm105 said:

Crowmo said:

DullGreyGuy said:

Crowmo said:

I work as a locum via a limited company and genuinely do half my shifts near my home and the other half near my parents in law 50 miles away.
i do stay at my parents in law and give them money for general lodging etc for nights I do shifts there.
could the limited company pay for these
lodgings costs as the travel and accommodation is genuinely 100% for buisness( would not go there otherwise)
then my parents in law could claim up to 7,500 tax free in terms of rent a room relief?

thanks in advance 

If the in-laws weren't living there, what would you do?

Are the shifts on consecutive days so you are saving on travel costs or are they on separate days so still incurring 100 miles travel each time?

How long have you been working at this place? How long left on the contract?

thanks for input.
to clarify.

being able to travel to that side of london ( yes the 50miles is mostly M1/M25- so in rush hour would be a horrendous round trip) so overnight accomodation has been 100% neccessary given the hours I work- allowed me to increase income by at least double.
i would maybe have to had look at Airbnb/hotels but these in london are not cheap and the inlaws would be much more cost effective.
the shifts are never long term,no contract all ad hoc, sometimes consecutive.sometimes not.
if there was no shifts I would not travel and stay so only travel and accomodation for buisness purposes.
the point is i could pay a random Airbnb or pay my inlaws to get same outcome for me 
so should be expensable to buisness right?
thanks

you need to talk to your accountant
just because you have a Ltd does not necessarily mean your travel and accommodation costs are claimable.
the overarching principle is that you must be going to a temporary workplace for a task of limited duration 

although you are on locum work, it appears you have 2 normal places of employment: near home and 50 miles away. It appears, at face value, you simply have 2 part time jobs?
Travel to either could be classed as ordinary commuting since there is a clear pattern to and predictability of the workplaces.
Potentially, although I assume subject to a contract termination date, neither workplace is "temporary" and therefore may not be allowed as travel and subsistence costs at all.

what do you class as your normal place of employment?
if you claim it is your home and therefore you undertake zero "ordinary commuting" you need to make sure your accountant is very happy with that position as it has significant repercussions .

thanks, 
not trying to tax dodge, just seeing if it is allowable.
there is no 'part time work' all are contracted works and CEST tool shows outside IR35
there is no 'two places of work' in one area its wycombe/ayelsbury luton bedford, hemel hempstead and on the other side is welyn garden city, seven kings, barking and romford. variable shifts at each location, sometimes none in a month sometimes multiple- all depend, all different companys etc. given wide geography travel is never to a normal commute and so I am assuming travel and accomodation is valid expenses.
sorry if confusing.
accountant is happy with the situation but just wanted some outside opinion.
thanks

Grumpy_chap

Crowmo said:

accountant is happy with the situation

This is all you really need to know.

There are a lot of edge cases with regard to permitted allowable expenses, even more so when it is a one-person Ltd Co. contractor.  There are cases where expenses can be allowable for the individual (to claim from the Ltd Co. and not give rise to personal tax liability) but the costs are not allowable for the Ltd Co. to set against corporation tax.

These complexities when the edge cases arise mean that a forum like this one will always return differing views, partly because the full situation is not necessarily clear from a few comments in a thread.  That is exactly the outcome you have found from this thread.

Your Accountant, however, will have looked at the full situation in proper detail and given appropriate advice which you can rely on.  You can be sure that the Accountant will have given the advice having one eye on the potential for a PI claim should the advice be incorrect.  No-one in the forum has to worry about such matters.