10 expenses that will trip up PAYE workers

  1. Mobile telephone – if the contract is in your personal name you can only claim business related call costs.
  2.  The £8,500 trap - if an employee earns below this amount but receives benefits in kind taking them over the limit, A P9D has to be submitted.
  3.  A director has to submit a P11D no matter what they earn and complete a self-assessment.
  4.  Pensions - pension contributions are limited to a maximum of £50,000. This will reduce to £40,000 next year subject to an employee’s pay exceeding this amount. Watch out for the 3 year rule.
  5.  Pension pots - the fund will be reduced by £250,000 to £1,250,000 from the 6th April 2014
  6.  All expenses claims must be wholly and exclusively incurred in the performance of their duties, otherwise not allowable.
  7.  Working lunches – are only allowable if all the company get fed.
  8.  Watch out for the Christmas party - an employer is only allowed to claim £150 per annum for entertaining staff and their families.
  9.  Tax free mileage allowances - most people know the limits and allowances. Don’t forget to keep records of journeys made.
  10.  If your employer buys clothing for work it must display the company logo, even if it’s an Armani suit