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jiltjilt Font Of All KnowledgeRegistered Posts: 2,903
Can the small weekly allowance that a sole trader claims for working from home be claimed by a director of a limited company, and can a director also claim mileage if he hasn't up until now been paid through PAYE?

Sorry ithey're such a basic questions, it's not come up with my limited company clients before and want to get it right before sending the file off to the chartered accountant for review.

Comments

  • groundygroundy Trusted Regular Registered Posts: 495
    You can charge £2 per week maximum for use of home as office for a Limited company. The alternative is for the director to charge a rent based on the the percentage use of his/hers household expenses.

    And yes a director can reclaim mileage even if there is no PAYE. The mileage claim is a claim to recover expenses incurred and is seperate to any PAYE matters.
  • jiltjilt Font Of All Knowledge Registered Posts: 2,903
    groundy wrote: »
    You can charge £2 per week maximum for use of home as office for a Limited company. The alternative is for the director to charge a rent based on the the percentage use of his/hers household expenses.

    And yes a director can reclaim mileage even if there is no PAYE. The mileage claim is a claim to recover expenses incurred and is seperate to any PAYE matters.

    Thanks groundy I wanted to be sure.
  • MonsoonMonsoon Font Of All Knowledge FMAAT, AAT Licensed Accountant Posts: 4,071
    I concur with what Groundy said :)

    Just to add that in the second case (claiming household expenses) the director would have to put rental income on self assessment tax return. Rent a Room Relief does not apply.
  • jiltjilt Font Of All Knowledge Registered Posts: 2,903
    Thanks Monsoon, I had decided that the small use of home allowance most reflected the use value wise, and also would eliminate the need to include rental income on his personal return.

    I just wasn't sure if the rules for sole traders applied to directors also.
  • MonsoonMonsoon Font Of All Knowledge FMAAT, AAT Licensed Accountant Posts: 4,071
    jilt wrote: »
    Thanks Monsoon, I had decided that the small use of home allowance most reflected the use value wise, and also would eliminate the need to include rental income on his personal return.

    I just wasn't sure if the rules for sole traders applied to directors also.
    No problem :)

    Often very very different, always best to check!
  • Nilesh MandviaNilesh Mandvia Feels At Home Registered Posts: 91
    groundy wrote: »
    You can charge £2 per week maximum ...

    I thought £2.00 was for 2007/2008 tax year and from 2008/09 is £3.00 per week.
  • mc25mc25 Well-Known Registered Posts: 232
    Nilesh you are right it used to be £2 per week new rate is £3.
  • MonsoonMonsoon Font Of All Knowledge FMAAT, AAT Licensed Accountant Posts: 4,071
    mc25 wrote: »
    Nilesh you are right it used to be £2 per week new rate is £3.

    Yep, whoops, missed that one! :lol:
  • jiltjilt Font Of All Knowledge Registered Posts: 2,903
    Yeah I had used the £3 rate. Thanks to you all for your imput.
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