How do I apportion the expenses when working out the deemed payment where a contract straddles the end of the tax year?
When working out the IR35 deemed payment, relief should be given for all
allowable expenses met by the intermediary in the tax year, in respect of
relevant engagements, as set out at Step 3. Relief for the expense should
be given by reference to the date when the intermediary meets the liability.
This is the date when the bill is paid, therefore there should be no need
to apportion any expenses.
For example, an intermediary has a relevant engagement that runs from 1
January to 30 June 2001, during which the worker is required to work at
a temporary workplace. In the course of this engagement the worker stays
in bed and breakfast accommodation. The bill is settled on a monthly basis
in arrears, with 14 days to pay. At the end of March a bill for £400
is issued which the intermediary pays on 12 April. The liability was met
in the tax year 2001-2002, therefore relief for the expense will be given
when working out the deemed payment payable at 5 April 2002
| Home | ||||
