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December Questions and Answers

Newsletter issue – December 2022

Q. The sales representative for my company leaves home early in the morning for a two-day business trip that includes an overnight stay. What can the company pay him as a daily allowance if he does not produce any receipts?

A:By the end of day 1 the sales rep will have been traveling on business for more than 15 hours and will also be away from the office at 8 pm. He can thus be paid a tax-free meal allowance for that day totaling £25. However, the sales rep does need to provide evidence of their expenditure on food and drink during that trip. He can also be paid a tax-free £5 allowance for incidental expenses as he is away overnight and doesn't need to produce a receipt for that.

Q. Myself and my husband are both employed by the same company, we work from home, but our employer didn't pay us the £6 per week working from home allowance. We also jointly own a let property. Can we claim the home working allowance against our salaries and also against our property rental income?

A:If you are required to work from home under your employment contracts but you aren't paid the working from home allowance, you can claim £6 per week each as a deductible expense on your tax returns. You can't claim a similar deduction from your rental income, as that deduction is only relevant to employment income.

Q. I work through my own company which pays me a salary and dividends, but I'm confused as to whether I should classify myself as employed or self-employed.

A:From a tax point of view, and legally, you are an employee of your own company, so you are employed. However, if you are applying for a loan or a mortgage the lender may treat you as "self-employed" as you are in control of your own income.