Is there anybody out there who can lend me a hand?
I have a OMB limited company client, who wants to pay £25 per night to stay at his parents house. My client intends paying from his company account and can get an invoice from his parents. He has just started a contract working 100 miles from his home for 3 to 4 days each week. His parents live 20 miles from where he is working. There used to be an allowance for staying at friends and family accommodation, if agreed by HMRC dispensation. He does not have a dispensation. I understand that asking for this allowance under dispensation rules is no longer possible.
He probably would not have taken the contract if he would have had to pay expensive hotel bills or commute each day. To me it seems a reasonable expense and at the same time a great chance to spend time with ma and pa. I have trawled the web looking for answers and saw one on Accountingweb by Steve Kesby (Sole Trader staying with family 2012) which suggested that a sole trader could expense the accommodation if wholly and exclusively for business. Would this also apply to OMB limited companies?
Many thanks to anyone who spends time on this question.
Replies (5)
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My comments...
... are exactly the same. If the employee incurs actual expenditure obtaining board and lodging from his family in circumstances where the costs of a stay in a hotel, for example, would be allowable, then that actual expenditure can be claimed.
The fact that it's to family is irrelevant, unless it's excessive in amount.
If it's just a fiction thugh, it doesn't work. HMRC will naturally be sceptical, so obtaining evidence that there is actual expenditure is just as important as was discussed in the previous thread, relating to a self-employed individual.
Same comments apply
If the rent a room limit isn't exceeded, there won't be anything to report.