A client, which is local church, wishes to reimburse one of its elders, who is an employee, for hospitality expenses. He and his wife regularly entertain church members and other visitors on behalf of the church, by providing meals and/or overnight accommodation.
What is the best way for this to be done, without creating complicated tax consequences?
For example, could the church agree to pay the elder an allowance of £X per head for each meal, and £Y per night for bed and breakfast accommodation, provided to guests on behalf of the church?
And, if so, would it be possible and/or beneficial for the church to apply for a P11DX dispensation in respect of such expenses?
Replies (18)
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Not clear
What an "elder" is. Is it an employment?
I suppose there is a risk of being assessed as carrying on a hospitality business so the question would be how is it demonstrates that there is no profit intended (or in fact earned).
mm??
No it's not just Mormons. But members of the Church of Jesus Christ of the Latter Day Saints pay tax just like everyone else.Isn't "elder" is a mormon thing?
Church of Scotland has Elders
Isn't "elder" is a mormon thing?
The Church of Scotland congregations have Elders who, along with the Minister, run the individual church.
http://en.wikipedia.org/wiki/Ministers_and_elders_of_the_Church_of_Scotland
Actual costs
Doubt if you could get a flat rate agreed.
Worth asking, I suppose.
Otherwise, it's reimbursement of actual costs incurred.
Have you considered Mark 12:17 ?
Tax advantage
With regard to Mark 12:17, lionofludesch, I should be interested to hear your thoughts on its application in this scenario!
Clearly, there should be no tax advantage !!
What about Rent-a-Room relief to cover b+b and actual costs of ingredients to cover the meals ?
More subtle approach to issue
If the elder is making a contribution to the Church each year via say Gift aid, which I expect is quite likely, could he/she stop making this payment and instead provide the accomodation/services to the church for free.
This might not work re the feelings of the parties, and the Church would lose the tax benefit of the contribution as I doubt a Gift Aid payment can be made by providing meals etc as a gift in specie, and the quantum of the possible two way payments may not match, but it would solve the hassle of the Church needing to reimburse the cost and deal with the tax issues.
there was a point
There was a point..from what I understand of the mormon church, it would have been unlikely for the elders to be employees, as all adult males are elders and services to the church are duties rather than employments.
Never heard of a Church of Scotland though, I think you're making that one up.
Sheltered Life
Never heard of a Church of Scotland though, I think you're making that one up.
What ????????
What about the Church of Ireland ?
Protestant Reformation passed you by, it appears
There was a point..from what I understand of the mormon church, it would have been unlikely for the elders to be employees, as all adult males are elders and services to the church are duties rather than employments.
Never heard of a Church of Scotland though, I think you're making that one up.
You are joking,!!!!!
The two main churches in Scotland are the Church of Scotland and the Catholic Church. The majority of churches in Scotland belong to the Church of Scotland.
yes
You are joking,!!!!!
[/quote]
Sorry, just my humour. Where was the "Better Together" campaign when you needed them?
Church Elder
Re Peter T P.
EIM 60046 refers only to "Ministers". Here we have an Elder (probably not the Minister)!
Elders
Really in confirmation of various comments above, elder is a term used by a number of different churches with a variety of broadly similar meanings. In the Church of Jesus Christ of Latter-day Saints of which I am a member it is more widely used as it denotes an adult holder of the priesthood (which applies to all active adult males) but is also used as a term to describe male full-time missionaries (you know the smart young men with name tags that say Elder ... - as seen on TV recently!). As we do not have paid clergy the issue of elders being employees does not arise!
Reminds me ....
It reminds me of the little old lady who went into the Post Office to ask for a dozen Christmas stamps.
"Certainly, madam," said the clerk, "What denomination ?" (meaning first or second class, like).
"Oh - I don't know", said the old lady. After some thought, "I'll take six Baptist and six Roman Catholic".