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Minister of Religion expenses

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I'm filing a self-assessment for a Minister of Religion and wanted to check regarding the 'Rent' expenses. Is rent the only home expense that is allowable or can this include utility bills and council tax like with self-employed individuals? Obviously proportioned by room/usage. Or perhaps the flat rate is more applicable?

Secondly, their previous accountant including accountancy fees as an expense. Their only accountancy need is to file the self-assessment and I believed this was disallowed. Is that right?

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By mbee1
28th Jul 2021 14:56

Much also depends on the denomination. Most clergy in provided accommodation (tax free) do not pay council tax and water rates.

Accountancy is not allowable unless you're charging for something else other than their clerical income, for example, a self employment or a let property, in which case the fee or part of it can be charged there.

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By pwilson
29th Jul 2021 08:58

He has his own privately owned house which he uses for admin, video meetings with parishioners and (pre-covid times) face to face meetings with parishioners. As this is business use of home in line with his normal employment, would he not be entitled to the same tax relief as other employees? He does pay council tax and water costs. He is mortgage free so no mortgage interest to include.

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By Hugo Fair
29th Jul 2021 12:09

Does the church (the physical building) not provide facilities for admin & meetings?
If so, although it may be more comfortable at home, I'd have thought the same pre-covid rule would apply to him as to other employees regarding WFH. In other words, he has elected to WFH (not been told to do so) ... and so those tax reliefs are not available to him.

But in your OP you referred to self-employment and now you're introducing "his normal employment" - so which is in play?
And your OP appeared to be all about the specifics applying to a Minister of Religion, whereas you've now moved into aspects of "the same tax relief as other employees" - so again what question are you actually raising?

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By mbee1
29th Jul 2021 14:54

Hugo Fair wrote:

Does the church (the physical building) not provide facilities for admin & meetings?
If so, although it may be more comfortable at home, I'd have thought the same pre-covid rule would apply to him as to other employees regarding WFH. In other words, he has elected to WFH (not been told to do so) ... and so those tax reliefs are not available to him.

But in your OP you referred to self-employment and now you're introducing "his normal employment" - so which is in play?
And your OP appeared to be all about the specifics applying to a Minister of Religion, whereas you've now moved into aspects of "the same tax relief as other employees" - so again what question are you actually raising?


It's generally accepted by HMRC that Minsters of Religion work from home. In most cases accommodation is provided, for example, a Vicarage, Manse, etc. but the fact that they ay live in their own home would not preclude them from claiming tax reliefs on some home running costs.
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By Hugo Fair
29th Jul 2021 15:29

Not arguing, but I'd love to know the source for "it's generally accepted .."?
Makes me wonder what the physical church is seen as when minister officiates there, if it's not a place of work. [I don't believe I can claim to work from home whilst regularly going in to the office to meet clients and host events.]

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By mbee1
29th Jul 2021 14:52

A Minister of Religion is, usually, not an employee but an office holder. If they are paid as a Minister of Religion, PAYE should normally be operated although there are cases where itinerant ministers are self employed. When it comes to completing a Tax Return you do not complete an Employment schedule but a Minister of Religion schedule (SA102M) for which HMRC provide notes. These notes give guidance on what reliefs can be claimed.
Further information can be found at EIM60040 (S336 & S351 ITEPA 2003).

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By Hugo Fair
29th Jul 2021 15:31

Which takes us right back to my first post ... but without answering OP's specific questions?

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By Tax Dragon
29th Jul 2021 16:07

I thought your first post had answered the OP's specific questions.

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By Hugo Fair
29th Jul 2021 18:29

Well I had thought so ... it was meant to be taking a leaf out of your style book (you can lead a horse to water, but thereafter it's the horse's choice what to do) - until everyone started wandering off down the byways of 'interesting but not necessarily relevant' concepts.
Maybe I should stick to my natural style (more 'here's a thought ..' snippets), which definitely works better in face-to-face chats than spread over a forum. Ah well!

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By mbee1
30th Jul 2021 08:28

I'm a specialist tax adviser for Ministers of Religion. Most people think that Ministers work one day a week on Sunday and preach in a church. How wrong they are. A Minister who is provided with a house has a specific exemption on the house as a benefit in kind. If they are provided with services in the house (many get a contribution towards heating, lighting, cleaning and garden upkeep) the benefit in kind is limited under the service benefit rules as they are required to live there by virtue of their post.

They meet people pre marriage, pre and post funeral, pastoral matters and much of this is done from home which is their place of work - not the church. They also may have a role in the wider church, for example, within the Diocese if they are Church of England or within a Circuit if they are Methodists.

Some may not be provided with a house for various reasons. There may not be one suitable for, say, the size of the family. Housing allowances are often paid to these Ministers to enable them to buy a house. The fact they may live in their own home does not preclude the from claiming a proportion of the running costs in a similar way if they lived in a provided house.

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Replying to mbee1:
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By Tax Dragon
30th Jul 2021 09:12

OP's client works from his own house. The 10% etc not relevant.

I don't think anyone is disagreeing over the answer to the OP's questions.

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By Eddie S
30th Jul 2021 21:04

OMG! How this takes me back.
In the mid 60s I was a humble tax officer and there was a local country vicar claiming under S198 (orS189 - I can’t be expected to remember everything but it was the 1952 Act I think)for the cost of keeping a horse. We had all the obvious jokes about ridden down value etc. Having started my career in 65 at 17 never thought I’d still be at it at 72!!!

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