You will have to show HMRC that you are not under the Claiming tax relief via self-assessmentĬlaim these expenses still exists for umbrella contractors, but they cannot beĬlaimed at source. The original rules surrounding this still remain in force, so should you require any clarification then please do not hesitate to contact us and we can talk you through this. You will have to show HMRC that you are not under the Supervision, Direction or Control of the end client and if you are able to do this, then these expenses may be put through via self-assessment at the end of the financial year by the individual. Claiming tax relief via self-assessment The ability to claim these expenses still exists for umbrella contractors, but they cannot be claimed at source. These would have been classed as non-chargeable expenses, which were out of pocket costs that were incurred as a direct result of your assignment work. However the terms “wholly” and “exclusively” prevented deductions for expenditure that serves a dual purpose, a business purpose and a non-business purpose. “for an expense to be deductible from your earnings the expense must be incurred wholly and exclusively in the performance of your assignment.” However the terms “wholly” and “exclusively” prevented deductions for expenditure that serves a dual purpose, a business purpose and a non-business purpose. Previously umbrella companies operated in line with tax legislation that stated It also look at the feasibility of the contractor to see if they should be claiming the tax relief on expenses if they are deemed to be under the supervision, direction and control of the end client. On the 6th April 2016, HMRC changed the way in which umbrella companies operated, limiting the ability to process travel & subsistence umbrella company expenses for tax relief purposes. (Previously used to claim tax relief, no longer available through our payroll)
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