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Sam
Sam, Accountant
Category: Tax
Satisfied Customers: 13917
Experience:  26 HMRC expertise, PAYE, Self Assessment ,Residency, Rental Income, Capital Gains, CIS ask for Sam Tax
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I have a employment contract which stipulates that my place

Customer Question

Hi. I have a employment contract which stipulates that my place of work is in the UK. However practically 100% of my work is done in Spain. Therefore I am claiming all travel, food and accommodation expenses on my HMRC tax return. I have received a letter from HRMC stating that they would like to question my declaration. What is my position on this?
Submitted: 2 months ago.
Category: Tax
Customer: replied 2 months ago.
Let me know if you need more information, or send me the service offer(s) so we can proceed.
Customer: replied 2 months ago.
Posted by JustAnswer at customer's request) Hello. I would like to request the following Expert Service(s) from you: Live Phone Call.
Customer: replied 2 months ago.
Hi. As a follow up to my initial enquiry. Would it be possible to speak to someone as I may need to provide more details if required to explain the situation. The contract of employment states that the place of work is UK as described. The actual job is performed in Spain as it is where the service is provided from. I have maintain my residency in the UK to maintain continuity, although I spend most of my working time in Spain. After receiving the letter from HRMC, I am now concerned as I don't know where I stand from a tax perspective.
Customer: replied 2 months ago.
Hi. I just thought I would add some additional details. I have included in my expenses item associated with accommodation, transport ( including flights to Spain), and meals.
Expert:  Sam replied 2 months ago.

Hi, Sam here , one of the UK tax Experts here on Just Answer, thank you for your question and I shall reply shortly

Expert:  Sam replied 2 months ago.

HI

Thanks for your patience

Food is not an allowable expense usually - but where do you stay when in Spain - hoe often do you return to the UK - do you own property or have a rental agreement if so is this in the UK or Spain or both

Where do you consider your home and how much time do you spend in the Uk and are any of these for work purposes

Does your employer reimburse any of your travel and meal costs ? Or any other work related expenses ? I can then advise further

Thanks

Sam

Customer: replied 2 months ago.
Hi, and thanks. Here is where I don't know or understand where I stand from a tax perspective. As mentioned, my contract with my employer states the UK as place of work, however I am required to be in Spain to perform my work. I have residency in the UK, and I have a house in the UK on which I pay a mortgage. I also pay my council tax, etc. I have to work Monday to Friday in Spain, and I usually return to the UK at weekends. Therefore I have adopted a position that I consider UK as permanent residency. Therefore reason of why I have expensed my costs associated with having to go to Spain to work. I have a place that I rent on a weekly / monthly basis as accomodation. I have to travel by taxi to and from office. I also claim the flights from UK to Spain.
Customer: replied 2 months ago.
To confirm, my employer does not pay these expenses.
Expert:  Sam replied 2 months ago.

Hi

Then you remin as being treated as UK resident for tax purposes as you life is stil conducted in the Uka dn you spend more than 90 days a year in the UK

However you cannot claim the cost for rent and food in Spain - nor the taxi fares

The reason for this as follows

If you stayed in a hotel or bed and breakfast you could have those costs as clearly connected with a business trip but you get to enjoy a normal life Monday to Friday by having a whole property at your disposal - and we all have to eat to live so none of these expenses are allowable either and as your normal place of work of from the rented accommodation to the Spanish office thee costs are also not allowable

Flights from the UK to Spain are allowable if your employer sent you to Spain to work as these are true out of pocket expenses for work but that is all

You should just be honest with HMRC that you thought all these costs would be allowable, but I am afraid you may owe then tax back for earlier years as most of these costs are not true business/employment costs

Sorry the news is not more favourable

Thanks

Sam

Customer: replied 2 months ago.
Hi. Thanks for your response. Yes, I agree that honesty is the correct approach, hence reaching out for this service. To clarify, and I don't know whether it makes a difference. I am clear on the flights. The taxi fares I have claimed are specifically related from the airport to the offices. The place where I stay I do it on a temporary basis as it is cheaper than a Hotel or B&B.Could you please clarify the following paragraph you wrote? I couldn't understand the "Uka dn". I assume that "remin" means remain?"Then you remin as being treated as UK resident for tax purposes as you life is stil conducted in the Uka dn you spend more than 90 days a year in the UK".
Customer: replied 2 months ago.
Does the taxis in the UK from home to the airport to take the flight to Spain can be expensed? and can the car park at the airport in the UK be expensed? Also can the train fares from the home in the UK to the airport to take the flights be expensed? Thanks again.
Expert:  Sam replied 2 months ago.

Hi

Thanks for your response and many apologies for my typo's

I am afraid the fact you rent someone which provides more than a hotel of B & B but is deemed to be temporary is still not making it an allowable expense s its not incurred so you can can undertake your job solely, it provides a "home" setting in a way that a hotel or B & B would not - and that's why its not allowable

If the taxi fares are just from the airport to work then I would then state these are allowable - but not from your rented accommodation to work

That first paragraph should have read "

Then you remain as being treated as UK resident for tax purposes as you life is still conducted in the Uk and you spend more than 90 days a year in the UK so you are still a UK taxpayer

Then you ask more questions (this really should be listed as a new question or you pay for more question and answer time, but as this appears to be your first time on Just Answer, I will answer these additional questions on this occasion

You ask

Does the taxis in the UK from home to the airport to take the flight to Spain can be expensed?

Probably not as I would assume the train would be cheaper or driving and paying for car park? And you then go on and ask

can the car park at the airport in the UK be expensed? You cannot have taxi fares and car park fares ????

Also can the train fares from the home in the UK to the airport to take the flights be expensed? Yes but not a taxi also -

HMRC may restrict the travel to and from the airports and associated costs unless your employment contract recognises that you do live in the UK but that all duties must be carried out in Spain thereby forcing you to have no choice but incur these initial expenses - you state that your contract states your work is taking place in the UK so really you need to get your employer to update your contract of employment and back date to from when this began

I also do not understand why your employer fails to cover any of your costs - this is usually indicative of what is a true employment related (or business) expense and what is not

Thanks

Sam

Customer: replied 2 months ago.
Please. I am simply reaching out for help. I understand that this is a paid service, however it feels as I am doing something wrong by asking? The only reason that I have asked the questions related to trains, car parks, and taxis is that as you may or may not be aware, during the last year we suffered a significant amount of strikes in the South East, therefore alternative transport had to be arranged as trains were not operating regularly. I had on some instances drive my car to the airport and leave it in the car park for the week. On a couple of instances I had to use a taxi as I didn't have a car and trains were not running. My apologies, it is my first time using this service and I was not clear what I had to do at the beginning.
Expert:  Sam replied 2 months ago.

HI

You have done something wrong - you have made false claims for expenses with HMRC and I am sorry I am not sugar coating this for you but you have claimed far more than you are entitled to so have received tax refunds you aren't due.

I am sorry however if these is coming across too harshly - but you need to be prepared for the fact HMRC will be more direct and less lenient - as they hold the cards with interest charges and penalties which they will visit upon you along with any tax you owe them

Ideally you should have sought advise before you made claims, this could have been done either from HMRC or through your employer (the employer whom could have provided guidance from the 480 expense and benefits guide) but I am trying to help you see what is and what is not allowable and why, to prepare you for this but I am afraid my time with HMRC clearly still dominates my direction on both advsie and questioning and for this I am very sorry

But as you had public transport available and a car to drive - taxis to the airport would be deemed to be not allowable unless you car was not available and on that same day nor was public transport possible - then you can justify the expense of a taxi -

I myself live in the South East and travel to London often so I understand what you are inferring.

Do let me know if I can assist further or if you have all you need then pleas do rate the level of service provided

But finally do provide as much detail to HMRC as possible to justify the expenses, and why they arose - do get your employer to update your contract and also establish with your employer why they were not in a position to assist with the costs as some incurred directly through your provision of employment with them

Thanks

Sam

Customer: replied 2 months ago.
Many thanks. There was never an intent to make any false claims, nor I was looking for sugar coating. I was simply reaching out to seek some advice as I have received a letter from HMRC regarding my expenses. It is obvious from your response that some of the expenses listed in my claim are not allowable, at it will be stated now clarified.I did in fact seek some advice last year, and I was informed there was a daily meal allowance. I can see that this was incorrect. Thanks.
Expert:  Sam replied 2 months ago.

Hi

Thanks for your response

Then I am sorry you were advised wrongly - make sure you tell HMRC this - as this clearly contributed to your belief that a meal allowance was permissible - it is when you are on a complete business trip - which would involve a hotel or B & B with an evening meal the night before and breakfast the next day but from the time you started renting accommodation this changed what was allowable

HMRc will clearly see there was no intent on your side to make false claims and that this was a genuine mistake and will take that into account with any penalties and interest charges

Do let me know if I can assist further,

Thanks

Sam

Customer: replied 2 months ago.
Good afternoon. To confirm I have already paid for this service. Thanks.
Expert:  Sam replied 2 months ago.

Hi

Thanks for your response

But you need to rate or click accept so that your payment is passed to me - much appreciated

Thanks

Sam

Customer: replied 2 months ago.
Good afternoon. To confirm - the amount has already been debited from my account. This service has already been paid. Thanks.
Expert:  Sam replied 2 months ago.

HI

But you need to click accept or rate the level for the service I have provided, so that the payment you made (that has been deducted from your account) and paid to Just Answer, can then be paid to me by Just Answer.

Its an internal admin aspect of the service so I am credited fro the wok I have undertaken

This would be appreciated

Thanks

Sam