Repaid expenses through 3rd party?

How are they treated?

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Work is completed through an agent, who bills the final client on my company's behalf, and then sends my company a 'self-bill invoice'.

When completing work in a specific week I incurred nearly 1k in expenses that I paid from my own pocket. Normally for business expenses I simply reimburse myself from my company's funds, however these were additional expenses that the agent has recouped for me from the end client. So in addition to my paid invoices I will also have a payment of nearly 1k into my company account, which I will then take out to reimburse myself. For the purposes of company income, does this count as 'money in' and then as an expense when removed? Should it be counted towards my total annual income or not - seeing as the only reason the money was put into company account was to pay me back for business expenses I personally incurred? All the other money paid in is for duties completed.

Replies (9)

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By Cheshire
06th Aug 2018 10:55

What does your Accountant say?

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By Duggimon
06th Aug 2018 11:09

Your question is too vague to know the answer for sure but it's probably just treated initially as income and then you deal with your expenses the normal way.

I would second the suggestion to ask your accountant rather than just forging on though because I've made so many assumptions the advice is worthless.

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Replying to Duggimon:
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By sep88
06th Aug 2018 11:17

What's vague about it?
Let's say I get paid 2k a week. The agent who found me the work bills the client, and the agent pays me a lump sum every period.

During my duties I was required to work away for a week incurring flights costs etc. These are beyond my 'normal' expenses (that I deduct from my business income). As they were specifically incurred by me working on location for the client, the client asked me to submit an expense claim. The agent got the money from the client and the agent will pay me in a separate bank run for the expenses I incurred.

So it's just like additional income to my business but I just take it all out as an expense repayment seeing as personally I am out of pocket?

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Replying to sep88:
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By Accountant A
06th Aug 2018 12:22

Quote:

Let's say I get paid 2k a week.

If you earn £100,000 a year, you'd get good value from appointing an accountant.

https://find.icaew.com/

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Replying to sep88:
By Duggimon
06th Aug 2018 14:44

Well it's a bit less vague now, I say go for it, do what you like, don't let these fuddy duddies tell you you need an accountant for accounting advice, there's no real consequences to getting it wrong, except for all the consequences.

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By sep88
06th Aug 2018 15:30

So no one is going to answer my question

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Replying to sep88:
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By Cheshire
06th Aug 2018 16:39

''So no one is going to answer my question''.

Is that a question or a statement?

You have received the very best response - get an Accountant.

No-one here can answer your query when you only provide a small part of the actual facts required to be able to answer it. If anyone does then you are likely not to get a correct answer.

Besides with the attitude you appear to have, probably not anyway.

Never mind that this is a forum for Accountants to help other Accountants. Clue is in the name and description. ''AccountingWEB.co.uk is the largest independent online community for accounting professionals''.

Your Limited Company could benefit from an Accountant doing the tax planning BEFORE you get to your first year end.

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By Matrix
06th Aug 2018 19:25

Yes this is income and, if the business is VAT registered, then a VAT invoice should have been raised.

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By Tax Dragon
07th Aug 2018 07:22

Income is what comes in.... so Matrix is probably right - but so's Cheshire: your question gives only partial facts. Even if you'd given perfect facts and received a perfect response, you(r company) would benefit from appointing an accountant.

I don't want that role, by the way, you sound more trouble than you are worth.

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