Replies to Queries - 2

A director of a close family company works as an engineer for various clients (there are no IR35 implications in this case). The company contracted for the director to work at a location four hours away from home from September 1998 to March 2000. Travel costs from home to the factory were claimed and treated as an allowable business expense as well as the cost of staying in an hotel from Monday to Thursday (inclusive) each week.

In February 2000 the contract was extended to last until April 2001. Hence he has been caught by the 24 months rules and the travel expenses were no longer deemed to be an allowable business expense.

The Inspector has now requested to see all receipts in respect of the accommodation/subsistence expenses. We suspect that the Inspector is going to disallow them too. The director paid for these himself and was...