Recent research has discovered that over half (57%) of contractors surveyed were unaware of the proposed changes to legislation affecting travel and subsistence tax relief that could come into force in April 2016. These alterations would restrict the tax relief individuals who operate through Limited Companies are able to claim on travel and subsistence.
Currently, freelancers and contractors operating within a Limited Company are currently able to claim tax relief on travel and subsistence expenses if they are a director. In many cases, these are claimed when travelling to and from their clients’ and for temporary accommodation and food costs when working away from home.
You are only able to claim travel expenses if the workplace is considered temporary therefore travel expenses are only allowable for 24 months. After 24 months, the workplace is no longer considered temporary, unless less than 40% of your time was spent there.
18% of survey respondents stated that they would consider permanent roles if these proposed changes come into effect. The remaining 82% were split almost evenly with 42% committing themselves to contracting while the following 40% were undecided about what they would do.
There is currently a petition against these proposed travel and subsistence tax relief changes and it’s available until the 11th March 2016. You can show your support by signing the petition HERE.
Here at Gorilla, our specialist contractor accountants will provide you with unlimited support for all your tax related queries and you’ll even get a same day response if you contact us before 3pm under our client guarantee service. In addition, your personal tax return is included within our all-inclusive package for just £85 + VAT per month! If you’re interested in a FREE trial of our online bookkeeping software, do not hesitate to contact us on 0330 024 0406. In addition, you can calculate your take home pay after tax here online with us.