Expenses Team
The expenses team helps contractors submit their legitimately-incurred business expenses efficiently
either online, by fax or by post. These days, the vast majority of contractors utilise their online
contractor portal as it includes various intuitive features to ensure both accuracy and speed including
assignment archive and mileage calculator. The team is also committed to providing contractors with
expert advice to ensure they are maximising their take-home pay.
Brian Thompson - Manager
0845 604 0571
Deanna Harding
0845 604 0571
Michelle Blackman - Head of Expenses
0845 604 0571 [email protected]
Hayley Woolmer
0845 604 0571 [email protected]Lorraine Robson
0845 604 0571 [email protected]Harry Goodall
0845 604 0571 [email protected]Expenses Office Hours
Monday - Friday
9am - 6pm
Expenses Enquiries
Please email [email protected]
What are Business Expenses?
Genuine BUSINESS EXPENSES are those that are incurred wholly, exclusively and necessarily in order to perform the duties of an assignment. The benefits of claiming business expenses are that income tax is not applied to the amount claimed as a proportion of your income.
Please note: money spent for the expense is not physically reimbursed; it is only the taxable element that can be off-set against salary.
How do Expenses Work?
An example: if you earn £1,000.00 gross (before tax and NI are applied) and submit £250.00 of expenses you would only be liable for tax on £750.00 of that gross amount, not the full £1,000.00.
You have to pay tax on at least National Minimum Wage based on the hours that you are working. This means that we may not be able to offset all the expenses you have submitted in one pay period. In these cases you will not lose the full benefit of what you have claimed as the remaining balance will sit on our system until you earn enough money to cover the deduction.
INFORMATION YOU WILL NEED
Before beginning, please ensure you have the following information to hand:
• Your home postcode
• The name of your assignment location (i.e. place of work)
• Your place of work postcode
• Your mode of transport (e.g. car, motorbike, bicycle, train, bus, taxi, etc)
• The precise time you left home
• The time you returned home
• Your receipts for any expenses you wish to claim
RACS Group’s ethos is fundamentally based on a desire to provide
Contractors with an unrivalled payroll service which embraces the
ultimate compliance credentials, best commercial value and
excellent customer service.
Our processes and procedures have been refined over the past seven years to comply with all government and HM Revenue & Customs’ legislative guidelines. This includes our Expenses Procedure, which has recently been updated to provide a new way of processing genuinely incurred business expenses.
This document provides an introduction to RACS Group’s Expenses
Procedures and outlines how we ensure our system collects all the information necessary to protect you, whilst remaining fully compliant.
This document gives an overview of the following key areas:
• Information you will need
• Logging into your account
• Your Online Contractors Portal
• Travel Log
• Expenses Section & Log
• Frequently Asked Questions
EXPENSES PROCEDURE GUIDE
TRAVEL
Travel to and from Assignments (Temporary Work Place)
In reference to the HM Revenue & Customs booklet on employee travel: using your own vehicle to travel between your home and ‘Client Site’ (temporary work place) allows you to claim mileage allowance in accordance with the HM Revenue & Customs Approved Mileage Rates. This can apply to bicycles, motorcycles and passengers as well as a car or van.
The current HM Revenue & Customs rates for mileage are as follows:
Other typical expenses that can be claimed are car parking costs, tolls and congestion charges – but only if proven to be included as part of your genuine business travel. Make sure you retain a VAT receipt, otherwise the claim can’t be verified.
Additionally, public transport costs to and from your temporary workplace can be claimed. For proof, make sure you keep your receipt or keep all of your tickets if a receipt is unavailable. Car hire can also be claimed, providing that proof is given that it is for business use. Receipts are required for the claims to be accepted.
Mode of travel First 10,000 Miles within the tax year Over 10,000 Miles within the tax year
Cars and Vans 45p per mile 25p per mile
Motorbikes and Scooters 24p per mile 24p per mile
Bicycles 20p per mile 20p per mile
Passengers 5p per mile 5p per mile
EXPENSES PROCEDURE GUIDE
MEALS
You may claim for any meals (normally lunch) whilst working. It must be proved that these claims were incurred during working hours and they must be supported with receipts unless covered under our dispensation. It is a good idea to keep evidence of all meals even if you do not submit receipts. HM Revenue & Customs guidelines state eligibility times for meals are Breakfast – prior to 6:00am (including travel time) and Evening Meal - after 8:00pm (including travel time).
Non-receipted - you may claim up to a certain level for lunch every day - provided you have incurred the cost in the first place. For larger lunch claims, please remember to submit receipts. These should be of a reasonable value and in line with your business activities.
£5 for breakfast (before 6:00am - including travel)
£5 for lunch (one meal - after 5 hours at work)
£10 for two meals (after 10 hours at work)
£15 for dinner (after 8:00pm - including Travel)
No receipts are required by us to claim these expenses but you must be able to account for the cost incurred if investigated by HM Revenue & Customs.
Breakfast rate - The rate may be paid where an employee leaves home earlier than usual and before 6.00 am and incurs a cost on breakfast taken away from his home after the qualifying journey has started. If an employee usually leaves before 6.00am the breakfast rate does not apply.
Late evening meal rate - The rate may be paid where the employee has to work later than usual, finishes work after 8.00pm having worked his normal day and has to buy a meal before the qualifying journey ends which he would usually have at home.
The breakfast and late evening meal rates are for use in exceptional circumstances only and are not intended for employees with regular early or late work patterns (see examples at HMRC BMSR - EIM05232).
One meal (5 hour) rate - The rate may be paid where the employee has been undertaking qualifying travel for a period of at least 5 hours and has incurred the cost of a meal.
Two meal (10 hour) rates - The rate may be paid where the employee has been undertaking qualifying travel for a period of at least 10 hours and has incurred the cost of a meal or meals.
Benchmark scale rate payments must be limited to three meal rates on one day or 24 hour period. A meal is defined as a
combination of food and drink and would take a normal dictionary meaning. Where employees are required to start early or finish late on a regular basis, the over 5 hour and 10 hour rate, whichever is applicable, can be paid provided that all the other qualifying rules are satisfied.
EXPENSES PROCEDURE GUIDE
£ Subtotal £ VAT £ Total
SECONDARY ACCOMMODATION
If you are staying away from home on business then your accommodation and evening meal can be claimed. You can claim up to £25 a day for meals when away for longer than 12 hours, but only if the cost of meals is not included in the cost of the hotel bill. Receipts must be provided when claiming.
Costs incurred by staying away from home in hotels and B&B’s can be claimed if it is more convenient to be closer to a temporary work place than it is to travel there and back again each day e.g. large amounts of travelling time. Receipts must be provided at the time of the claim and be for the specified period and can only cover your own costs, not costs incurred by anyone else sharing the accommodation with you.
In some circumstances you may be able to claim for the cost of rented accommodation and related
utility costs. However, you must also be able to show that you maintained and continued to pay for another residence elsewhere in the U.K. If not, then none of the expenses can be claimed. The first time this expense is claimed it must be backed up by a rental agreement.
For example: if you are renting a second property so you are closer to work because travelling there and back again each day would be too time consuming, but a hotel would cost far too much as you are there for a few months, you can claim the rental costs as an expense. If you are renting out your main home, whilst on site, the rented property is not a secondary cost and therefore cannot be claimed as an expense. You can also claim utility bills for the rented property. The council tax bill for example is classed as a secondary expense because you would have to pay this on both properties.
Your electricity/gas/water bills would only be classed as a secondary cost if your family retains your main home whilst you are staying in the rented property.
If you are staying in rented accommodation, you cannot claim meal
costs. It is HM Revenue & Custom’s belief that you can shop, prepare and cook your meals as though you were at home - these therefore are not additional costs and can’t be claimed.
You can claim small amounts for staying with Family and Friends instead of paying out for full hotel bills, although you would need to provide receipts for this to prove you have spent the money. If you do find this is an easier option please be aware that if HM Revenue & Customs investigate your claims your friends and family may be liable to pay tax on the contributions you have given.
EXPENSES PROCEDURE GUIDE
WHAT ELSE CAN BE CLAIMED?
Use of Home as Office
Provided you utilise your house for some element of home working, you will be eligible for up to £4.00 per week as an allowance for Home as Office. Receipts are not required here.
Specialist Clothing
If you purchase any work uniform or protective clothing then that can also be claimed on your expenses. Receipts and an explanation as to why the clothing is required are needed in order to it be reimbursed
Equipment & Stationery
Any equipment that is wholly and specifically used for work can be claimed. This could be stationery or postage costs for any work related letters.
Professional books that are needed can also be claimed but only if they are relevant to the job role you are currently employed to do. Receipts are required which are highlighted and totalled if necessary.
Telephones
You can also claim back any business calls made from your mobile or home. To do this, you will need to submit an itemised bill with the relevant calls highlighted and totalled. Without an itemised bill, you cannot claim these calls as expenses.
HM Revenue & Customs also does not recognise Pay-as-you-go mobile phone charges and mobile Top-ups aren’t accepted.
You can also claim any internet charges that occur whilst working. Again, an itemised bill is required. But, you cannot claim the cost of line/internet rental.
Eye Tests
If you are required to use a computer as part of your everyday working activities you are eligible to claim for your eye tests. However, unless proof can be provided that any glasses needed are direct results of working in front of a computer in your current role you cannot claim for them as well.
Professional Subscriptions and Affiliations
You can claim for professional subscriptions, courses and affiliations. To do this, you will need to submit a standard VAT invoice and proof of payment. If you are unsure about the types of professional items that can be reclaimed, please do not hesitate to ask. The courses and subscriptions need to be relevant to the job you are currently contracted to do.
EXPENSES PROCEDURE GUIDE
WHAT ELSE CAN BE CLAIMED?
Foreign Expenses
People living outside of the U.K. but working within the U.K. can claim the cost of travel between U.K. and home. You can also claim the cost of your accommodation and travel whilst in the U.K. However, certain criteria needs to be met which include being a non-UK domicile and retaining a residence in the home country.
To be eligible to claim expenses as a non-UK national you must have secured your position through your agency before you leave your home country and meet one of the following criteria;
1) You were not/have not been a resident in the UK for 2 tax years prior to your arrival. The UK tax year falls 6th April to 5th April in the following year.
OR
2) You have not been in the UK at all for any reason for the 2 years prior to your date of arrival.
If you meet the requirements stated above and can prove it, you will be eligible to claim for travel expenses back home for up to 5 years after you have arrived in the UK. You will also be able to treat your accommodation and subsistence expenses as tax deductible for a maximum period of up to 2 years from the date of your arrival.
You are able to claim for the cost of meals incurred during your normal working day and evening meals that are brought out e.g. takeaway, restaurants etc though only for yourself, not if you have included the cost of someone
else’s meal. Shopping bills and packed lunches are not claimable.
Going Home for a Visit
The full cost of journeys from the country where you usually live to the place where you are working and back again are fully tax deductible and there is no limit on the
amount of journeys you can claim for. Receipts must be provided at the time of claim for it to be allowed, if you do not have the receipt the actual ticket will be accepted as long it has the price clearly stated on it.
Family Members Coming to Visit
If your work keeps you in the UK for more than 3 months, the costs incurred by your husband/wife and/or children coming to visit you can be claimed as an expense against your tax. Please be aware that HM Revenue & Customs will only permit 2 such claims in each tax year for your family and receipts or travel tickets must be supplied at the time of the claim clearly stating the price.
Accommodation and Utility Expenses
The costs of hotels, B&Bs (Bed and Breakfast) and rent can be claimed as an expense. Hotel and B&B costs must have supporting receipts that cover the period being claimed at the time of the claim. If claiming rent you will need to provide a rental agreement in
EXPENSES PROCEDURE GUIDE
LOGGING IN TO YOUR CONTRACTORS PORTAL
To begin you need to visit our website www.racsgroup.com. On the right hand side under ‘Contractors & Freelancers’ you will see “LOG IN”. Please click here.
The next screen will ask you to enter your email address and your password. By default your password is your 6 digit date of birth (ddmmyy).
Your Online Contractors Portal
Once successfully logged in you are taken to your Online Portal where you can amend details, add agencies to your account, view payslips and submit expenses.
Click on the “Submit Expenses” tab at the top of the page. A calendar will appear, select week ending date.
In this section you first need to indicate if this is your ‘First Assignment’.
The following 3 questions require your input before the form can be submitted: 1. Is this a new Contract/Assignment?
2. Is your new place of work more than 10 miles from the previous? 3. Is the journey considerably different from the last one?
These questions refer to the 24 month rule that states: if you are in a position for more than 24 months you are considered a permanent employee and are NOT eligible to claim expenses.
A
A
EXPENSES PROCEDURE GUIDE
Completing the Online Form
Travel Log
This is for all types of transport and must be filled in fully.
Please follow steps 1 to 5 to complete the form:
1. Enter the date you travelled to the assignment you are claiming for.
2. Enter the name of the place you are working at, e.g. the school, hospital or company to whom you are providing your services. To do this you need to click on ‘+ new’ if it is the first time you are filling in this form or you are going to a new placement. The system will ask you to fill in the name, start date and the agency you worked
through for that assignment. After you have clicked ‘Add Workplace’, this location will automatically appear in a drop down box for the next claim.
3. Add the ‘location’ of your assignment, i.e. the town or city.
4. Enter the mode of transport used. If you are claiming for mileage, the mode of transport selected will automatically calculate the correct mileage rate. If you do not select public transport it will ask you to enter the registration details of the vehicle you drove to work.
EXPENSES PROCEDURE GUIDE
B
You are eligible to claim the meals listed above, dependant on your times of work. Please ensure you only select the
breakfast and evening meals in exceptional circumstances. Simply enter the number of days in the “one meal allowance” or “two meal allowance” section, for the days you have worked.
Please be aware if you are out of the house for 5-9 hours you can only claim for one meal allowance. You need to be out of the house for 10+ hours to be able to claim for the two meal allowance under our dispensation.
PLEASE KEEP ALL RECEIPTS AS THERE IS A HIGH CHANCE YOU WILL BE ASKED TO PRODUCE THEM FOR A SPOT CHECK.
Expenses Section
The “Expenses” section is where you claim other expenses that you have incurred. This ranges from meals to stationery, accommo-dation and even personal protective equipment required for your work.
B
EXPENSES PROCEDURE GUIDE
Expenses Log
The Expenses Log is where you need to add the details of any other expenses incurred (e.g. paper, postage, ink cartridges). Remember all expenses must be wholly and exclusively incurred for work purposes.
You will need to fill in the date, the expense incurred, a brief description, the workplace and the cost. If it is a new work place please use ‘+ new’ to enter the details, as you did with the travel section.
After you have completed your Expenses Claim Form and mileage log, please read the terms and conditions, then click ‘I agree with the above’.
Next, click the ‘Continue’ button and you will be directed to another page where you can upload receipts for the claims you have made on the form.
If you don’t have the facility to upload your receipts then just scroll down and there is a button to submit the form.
EXPENSES PROCEDURE GUIDE
Why has my claim for petrol been denied?
Petrol is covered in the price calculated by HM Revenue & Customs for mileage as are all running costs of your car (road tax, insurance and any repairs) and therefore cannot be claimed separately.
Why do I have to submit a form every week? Can I not just fill in one and it gets used every week?
The reason you are asked to fill in a separate form each week is due to the fact we would not know at the time of processing the claim if you had worked more or less in a particular week than usual. There may also be additional things you would be eligible for and want to claim for in any given week. There are also times when you may be ill and not make it to work for a day or two. If you over-claimed you would be liable to pay back the excess tax relief.
If I have forgotten to submit a claim for a previous week have I lost the benefit of those Expenses?
No. You are able to backdate expense claims providing you were being paid through RACS Group for the period you want to claim for and have continuing payments through us. The only time you would not be able to backdate a claim is if it falls in a previous tax year.
When do I get paid my expenses?
Typically you will get paid your expenses whenever you are next paid (weekly, fortnightly or monthly etc...). Please remember that all claims submitted MUST be supported by an Expense Claim Form (every time) and receipts where possible.
Some expenses may not be paid to you, if your earnings level falls near to or below National Minimum Wage or where proof has not been seen by us.
