tfboy

I'm wondering if someone here who's more accountant / tax-savvy could explain something.

I'm having a little tussle at work over business travel. In essence, I'm doing a lot of work in Paris at the moment, amongst other places, and for personal reasons, I want to down to the south west of France for the weekend.

I asked at work if, instead of flying back to London, I can get a flight down to the south west (which incidentally is cheaper) and apparently, it's "not possible" because it's seen as a benefit in kind because the south west is not my "primary residential location".

This just seems crazy. The only way work suggests I do it is they pay for a London - Paris (on Monday) then a Paris - London on Friday. I pay for a London - Paris - South west return ticket for the weekend, ensuring I'm back in London on Sunday evening so work can pay for another London to Paris the next Monday. It's just mad

Another example, we have a few Chinese colleagues also working out of our UK office and they have a business need to China every now and then because we have a team of Chinese guys working out in central China. Now the UK-based Chinese people would like to take the opportunity to see their friends and family, but they can't because any intra-China travel is "a benefit in kind" and therefore, work pays for them to come back to the UK and they have to pay a (lot more expensive) return ticket to go to China on their own backs.

So anyone know if there's a way around this? I could of course pay for my own ticket Paris - Southwest - Paris but then I'd argue that for insurance purposes, work wouldn't have any knowledge of where I am over the weekend because as far as they're concerned, I'm not back at home in the UK

On second thoughts, could it be an insurance thing?

Any ideas It just doesn't make sense and I'm trying to save the company some money with reduced travel expenses, but the destination is incompatible

TIA

__________________
Xavier

simonsheil

I'm preety sue in your case they are correct in what they are saying.

In case of the chineese it should be possible to fly back from a different airport by ineffect having leave while over there, eg fly to Bejing (work time), carry out work, travel (leave), fly home (work). I certainly know my Dad did this to the states multiple times without issue.

mr_awol

The problem is that for your employer to pay for your private travel is a benefit in kind, not insurance. Also, if only part of an expense is private but it is all on one bill, you may find yourself taxed on the business part too! This is one reason why most accountancy practices who bill a Ltd company for the personal tax work of it's directors will put that work on a separate invoice or Payment Request Note - so that HMRC canot try to treat the company's entire fee as a director's personal benefit.

More info on can be found here: HM Revenue & Customs: Travel expenses and benefits

The only thing that might work is if your work pay for your london to Paris trip, and you then pay for your own journey to the South West and back. Your work can then pay for you to return to London from Paris: you will have met all of your own personal travel costs which will have been cheaper (in terms of both time and money) than if you had gone from London in the first place.

The problem your work may have with this is that there is a risk that it could be deemed a benefit in a subsequent PAYE inquiry. If it does, then it is them who will get stung for tax/nic and interest and maybe penalties. I cant remember but off the top of my head the maximum penalty per incorrect form P11D is £3,000 (not that i would expect it to be levied but it is technically possible). Your work may not be happy to risk these potential costs for the sake of saving themselves a few quid and making your weekend a little nicer

Your Chinese colleagues can of course see friends etc whilst over there on business but cannot stay for an extended period. Perhaps if they were to plan their trip so that it included as much weekend time as possible (and your employer were happy with this) it might give them a little bit more time. I dont know what would happen if they booked (say) five days leave in the middle of two weeks' worth of work and your work just sent them out there for three weeks to save paying for two flights - however i'm sure if they ask the HMRC helpline they will get 'an' answer.

Sorry cant help more - brain hasnt warmed up yet

tfboy

Thanks for the replies chaps. Mr AWOL - fantastic username considering my question

Put another way, if I can prove that the south west destination is a place of residence and not just "off for a weekend holiday" - with, say, a utility bill in my name or something, would that change anything? I find it strange to believe that you can't legally / for tax purposes have two places of residence.

edit: just to clear one thing up: it's my company that book my travel through the company's own "travel agent" for all business trips. They are effectively saying they can't book a Paris - southwest ticket because the destination is not my primary residence. I asked if I could pay for it myself and then claim it back, but it looks like that can't be done (either for the same reason or for some other tax-related reason).

I just find it strange that it's ok to pay a £200 ticket for what is a business trip (I'm in Paris on business) but not ok to pay a £100 ticket (saving money) when the reason for travel is also for business - I wouldn't be asking for it if I wasn't in Paris and I'm in Paris only because of work in the first place - it's just the "home" destination that is different.

__________________
Xavier

roo

Why not ask them instead of going out monday - coming back friday, if they can do it in blocks of 2 or 3 weeks. So at the weekend you pay for yourself to go from Paris to SW France for two weekend then come back to the UK for the third?

It seems logical to me that they will only pay for your travel to your primary residence. It stops people trying to claim they live in a tax haven like andorra and the Channel Islands. It's a EU wide government thing rather than a company thing.

__________________
Jeff: Ambitious, but rubbish

tfboy

I can do, Jeff.

I was just being tight Or rather just wanted to understand why it can't be done. I see your point, but I'm not asking to go to Switzerland, Andorra or some other tax haven. I mean France is the last place I'd want to live in for tax reasons

__________________
Xavier

roo

I suppose, with it being a 'benefit in kind' (as it is not to your main home) rather than for business purposes it becomes taxable rather than tax deductable, and also works out more expensive for them to provide, just like some company car scemes and even parking spaces in certain areas.


You could always have the place in France as your primary location, but I guess it would be a drag having to go down to somewhere like Toulouse, Carcasonne or Marseille when you could be in Swindon or Basingstoke.

__________________
Jeff: Ambitious, but rubbish

sdenny

Could they not just pay for the paris-south ticket and note it as a benefit?

You then pay the tax on the benefit, but they pay less and you get the ticket for just the price of the tax?

__________________
You're obviously mistaking me for somebody who gives a 5h1t!

mr_awol

You cannot claim back because it isnt business travel - your ordinary residence being in the UK. Stupid i know but the company's money saving doesnt come into it - it is the tax implications.

Incidently, if you were an MEP then any trip which began or ended in Strasbourg would be classed as a business trip - not only that but you would be legally entitled to claim for the cheapest business class national airline (BA etc) ticket available - even if you actually flew with greasyjet. Therefore an MEP wanting to go to New York on a Jolly, cannot claim the cost of his flight. However, if he flies London to Strasbourg and then Strasborg to NY this is automatically a business trip and the flight can be claimed. If he gets the flights for £300 all in then he will be allowed to claim the £800 or whatever it was a business class flight would have cost him. As an added bonus it is all tax free

I think we may all be in the wrong job!

devonutopia

I agree with the above that the company is right here, and I doubt there's much you can do to get around it.

__________________
Jason - Only a Skoda.
Custom Fabia Bonnet Lifter Kits - £45! Click Me.
Cheesy bonnet lifter video to "raise me up" http://www.youtube.com/watch?v=hMnGECEi5Oc

See the mongrel's 260bhp Dyno Video!

tfboy

OK.

Just shows that politicians and tax people are stupid / thieves. Delete as applicable

Thanks for clearing it up. I won't bother querying it anymore. Actually, I just checked, for the trip I'd need, it's only about £125 return so I can pay for it

__________________
Xavier

postmanpat

Can you just take the Paris - London - Paris ticket they provide you with for the weekend home and exchange it at the ticket desk at the airport, or do you physically have to turn up in London?

__________________


Postmanpats car Fabia vRS Zennons, ESP, autochanger, 3rd headrest, heated seats, cruise control
SWMBO Octy Mk2 vS maxidot, duel zone wotsit, cruise, parking sensors, 18" alloys