Q. I am a locum optician operating though her limited company. I am a director of my company along side my mother who looks after the administration side of the business.
As a locum optician, I do not have any permanent place of work. I have formed relationship with a number of opticians and am booked to work for many different opticians over a number of weeks.
As I do not have any permanent place of work, I have been claiming from my company travelling expenses (IE mileage claim at statutory rates) between my home and my temporary place of work because I consider my self as an itinerant worker.
I understand rules for claiming travelling expenses have changed after 6.4.2016. Please can you advise me what the changes in these rules are and my position with regard to claiming my mileage allowance as locum optical at many different locations.
A. The supervision, direction or control (SDC) for employment intermediaries travel & subsistence (T & S) measure predominantly affects those workers employed by umbrella companies. The new rules only affect contractors who operate through their own limited companies where their contract(s) is caught by IR35. In these instances, the SDC test will not be used anyhow but the contractor is not entitled to claim tax relief to the associated T & S expenses & must pay the PAYE & NIC on any such expenses claimed. If the company does not pay the liability then the tax debt can be transferred to the director.
To be able to tax relief to T & S expenses these must be incurred during a business journey, ie visiting a temporary workplace. If the workplace becomes a permanent workplace then there is no eligibility to tax relief at the point the workplace becomes permanent.
A permanent workplace is one where a worker spends or is likely to spend more than 40% of their working time at that workplace and they must attend it over a period lasting more than 24 months. It is important to note that at the point the contractor knows a workplace will become a permanent workplace then they must cease claiming T & S expenses immediately. For example, a freelancer who has a contract for 18 months which is then extended by another 12 months, may claim tax relief to T & S expenses for the first 18 months but at the point it is extended by a further 12 months they are prevented from making any further claims as they know that their time at that same workplace will exceed 24 months; that is the cut off point.
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