Hi,
Client is a single director/shareholder of Ltd Company. He has just been offered a year long contract working away from his current place of work (which is at home).
As opposed to commuting each day to the new place of work he is considering renting a property for a year which is nearer but my question is whether this would then trigger a benefit in kind to him personally?
Replies (5)
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MP?
Is he/she an MP?
If so, it appears the current trend is to forget the rules and claim the lot (and more besides) tax free.
Temporary Workplace
I think I remember an arguement that if the employer considers renting a property will be cheaper than paying hotel bills this is allowable and no benefit arises.
This may however only apply for non-UK residents coming to work here. I'll leave it to you to research into this further or maybe someone will be kind enough to confirm if I am right.
That will be fine
Work related -Temporary contract -No problem
Warn him not to extend contract beyond two years.
No
It would not be a taxable benefit. As Valentino says, it would be a temporary workplace for 12 months. As it is not a permanent workplace, the rules about the cost of ordinary commuting not being tax deductible do not apply. Refer to the HMRC guidance booklet 490 on Employee travel, Chapter3 http://www.hmrc.gov.uk/helpsheets/490-chapter3.pdf . The example of "Doris" at 3.14 applies. Travel incudes subsistence and accommodation, as well as the cost of actual travel, as set out in Chapter 5 of 490.