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Can Close Company Directors Make Covid Tax Claims?

Just Wondering if Close Company Directors Permitted to Claim the £6 pw Working From Home Allowance

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Just looking at "EIM32795 - Home: working from home: pandemics" - Not that helpful, at:

https://www.gov.uk/hmrc-internal-manuals/employment-income-manual/eim32795

It refers to occasions "when employees are requested to work from home during pandemic outbreaks". Since close company directors more or less control decisions at the top, is there any chance the £6 per week allowance could be denied to close company directors on the basis it was the close company directors who decided to send themselves home because they all agreed they must work from home.

Cannot see anywhere that any distinction is drawn between employees and close company directors. They all seem to be employees for the purpose of this allowance.

Anyone know any better.

 

 

 

Replies (7)

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By Winnie Wiggleroom
29th Dec 2021 07:59

Are they employees that are required to work from home? If yes claim, if by personal choice no claim.

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By Matrix
29th Dec 2021 09:33

My close company clients don’t claim this since their employer has already reimbursed them.

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By D V Fields
29th Dec 2021 10:34

Try:

https://www.gov.uk/tax-relief-for-employees/working-at-home

As matrix said the employer could simply pay them the allowance without attracting a benefit in kind.

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Replying to D V Fields:
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By Hugo Fair
29th Dec 2021 11:30

... which, at the risk of stating the obvious, is far more advantageous to the individual (even a basic rate taxpayer).

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me
By henrylmosley
29th Dec 2021 10:38

Usually if this happens, then the losses are reimbursed.

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the sea otter
By memyself-eye
29th Dec 2021 15:58

yes, of course. I did when I was and don't now that I'm not.

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By More unearned luck
29th Dec 2021 17:15

Or the director gives the company a licence to occupy part of his or her home. In this case you aren't confined to £6a week and the b/e point is computed by reference to a proportion of total costs and not merely to the marginal cost.

Additionally the terms of any contract of employment between the director and the company aren't relevant.

This is of course most suitable for one person and one couple companies. If the participators aren't related to one another, it might be more difficult to agree licences.

NB if the director does have a written c of e and is drawing a salary at the PT then the company is probably breaking NMW laws. Quote from the ICAEW in Taxguide 7/00 "The DTI have told us that if there is a no written employment contract or other evidence of an intention to create an employer/worker relationship they will not seek to contend that there is an unwritten or implied employment relationship between a director and his company. As the Inland Revenue administers NMW as agents for the DTI they will adopt this policy also".

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