Can Umbrella Company Contractors Claim Travel Expenses?

Contractor expenses

As a contractor, you’ll need to pay out for certain things in order to keep your business going – from stationary to specialised equipment.

Contractors are then able to claim back on these costs, which helps to reduce their tax bill at the end of each year.

Obviously, you won’t be allowed to just claim for anything and everything – it has to be related to your business.

Typical allowable expenses include:

• Office costs – such as stationery, printer ink/cartridges, postage, phone/mobile/internet bills.
• Clothing expenses, should you require specific protective wear, a uniform or a costume.
• Financial costs – such as accountancy fees.
• Training courses – as long as they are related to your current line of work.
• If you work from home, you may be able to claim a proportion of costs for your heating, electricity, Council tax, mortgage interest/rent and internet/telephone use.

Can umbrella contractors claim expenses?

Compared to other types of self-employed workers, umbrella company contractors are a bit more limited when it comes to being able to claim back on expenses.

This is due to the fact that an umbrella contractor is employed by the umbrella, and is therefore treated similarly to a permanent employee in terms of being entitled to certain benefits, like holiday and sick pay.

Unfortunately, just like other permanent employees, this means that in general, umbrella contractors cannot claim back on expenses.

What about travel expenses?

In some cases, it is possible for umbrella contractors to claim expenses, but they would need to provide proof that they are not under the supervision, direction or control (SDC) of the end-hirer.

So, with regard to travel and subsistence expenses, as long as you’re not travelling to what would be considered your usual place of work, workers not under SDC could potentially claim for the following:

• Train, bus, air and taxi fares
• Hire charges
• Fuel
• Vehicle insurance
• Hotel rooms
• Meals on overnight business trips

For more information on working through an umbrella company, take a look at our How does an Umbrella Company work? page.

Our team of experts are available to answer any queries you may have, so drop us a line on 01442 795 100, email sophie.lewis@dolanaccountancy.com, or contact us via live chat.