If you are new to contracting or you are a first time director it will seem a little odd claiming back your expenses. Claiming expenses is not something that most PAYE employees do, they may occasionally use a hire car or have to stay away for a night or 2 on a course but its pretty unusual. That’s because most PAYE employees don’t normally generate legitimate expenses as part of their work. Contractors on the other hand generate legitimate expenses on a daily basis. Virtually all activity a contractor does is in relation to their work, travel is often to different premises and can be very far from home. Contractors are normally required to provide their own equipment and be responsible for their own financial affairs. This changes the work dynamics and provides legitimate situations to claim expenses as tax relief.
PAYE employees effectively operate under an umbrella that their employee provides for them, it’s a package that sees the employer doing all the tax and compliance legwork. Contractors using either our umbrella or limited solutions receive a similar level of support but have the advantage of being able to claim for legitimate expenses.
HM Revenue & Customs (HMRC) states that expenses claimed must be incurred wholly, exclusively and necessarily in the performance of your duties, and tax laws define very strictly what you may claim for. This pamphlet explains which expenses are legitimate for you to claim.
Contractors Umbrella Company is required by HMRC to validate (as far as possible) that only legitimate expenses are processed, so ensure you only submit claims for legitimate expenses. We complete regular audits as part of our self regulation process and will overrule expenses if they are found to be non-compliant.
We look after your receipts, no more old envelopes stuffed with receipts. No more dreading an audit by HMRC. You send us your receipts, we scan them into our systems so each and every record is transparent, archived and auditable by HMRC and you. You can reference your receipts whnever you need to. Simple, seamless and hassle free. We take the pain and hassle out of accountability.
At Contractors Umbrella Company, we are always looking for new, SMART ways of working and delivering efficient solutions to our contractors. Our market leading accounting technology keeps our contractors pay and taxes within legislation. We know we're the best and we intend to keep it that way for the benefit of us and our contractors.
It's great to be compliant, but you need to understand and ensure you claim every single penny that you are entitled to, it is YOUR money after all. Our guide to Your expenses can be downloaded below, remember, we are only ever a call away. 0845 634 2552: Expert, friendly support
PAYE Calculator updated for 2022, free salary illustration for Contractors Umbrella Company in comparison to traditional PAYE employee
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