Tax question - Marina fees as a business expense?

[DeanS]

All points well received

 

Now....why have I just paid £200 for an extra water tank, if I have chosen to live in a marina that has free water on tap

[Ex- Member]

All points well received

 

Now....why have I just paid £200 for an extra water tank, if I have chosen to live in a marina that has free water on tap

 

In case you're evicted!

 

AND

 

Pays to have 2 of everything on a boat

[DeanS]

 

In case you're evicted!

 

AND

 

Pays to have 2 of everything on a boat

 

LOL!

 

The day is getting closer when the boats paid off, and we'll be able to sail off and sit on tow paths for 13.9 days....bliss.

[Timleech]

If you're paying 28% tax on £8500pa, you must have other substantial income already?

 

Just pay up & stop whinging.

 

Tim

[Ex- Member]

 

LOL!

 

The day is getting closer when the boats paid off, and we'll be able to sail off and sit on tow paths for 13.9 days....bliss.

 

Absolutely Dean.

 

We've been doing it for nearly 10 months now, definitely the happiest 10 months I've ever known, Lynn feels the same. I just hope we can continue to live like this for a good few years yet, having to live in bricks and mortar again would be like a prison sentence.

[Arthur Marshall]

It's an interesting point though. Friend of mine worked for the oil companies, self employed as a safety engineer. He lives on the Wirral, had to go and work in Hull or Scotland for three months so rented a flat there for those 3 months. This was tax deductible. If you therefore have a home mooring which you continue to pay for, but have to go and move to a marina for six months for work, I can't really see why that wouldn't in fact be tax deductible in the same way. Otherwise you'd rent a flat and claim that. This only works if you are self employed (the rules are completely diferent for employees under PAYE), which it looks like you are as you mentioned 28% tax. I worked for the Revenue for twenty odd years (some very odd) and for five or six at an accountants but never dealt much with s/e stuff, but I'll ask my ex-boss tomorrow and post what she says!

[DeanS]

If you're paying 28% tax on £8500pa, you must have other substantial income already?

 

Just pay up & stop whinging.

 

Tim

 

that's a bit of an assumption, and a bit harsh Your answer has zip to do with answering the genuine question I posted. ...and I'm not whinging.

It's an interesting point though. Friend of mine worked for the oil companies, self employed as a safety engineer. He lives on the Wirral, had to go and work in Hull or Scotland for three months so rented a flat there for those 3 months. This was tax deductible. If you therefore have a home mooring which you continue to pay for, but have to go and move to a marina for six months for work, I can't really see why that wouldn't in fact be tax deductible in the same way. Otherwise you'd rent a flat and claim that. This only works if you are self employed (the rules are completely diferent for employees under PAYE), which it looks like you are as you mentioned 28% tax. I worked for the Revenue for twenty odd years (some very odd) and for five or six at an accountants but never dealt much with s/e stuff, but I'll ask my ex-boss tomorrow and post what she says!

 

Thanks Arthur! Yes I'm self employed, so I pay 20% of profits, plus 8% NI tax, = 28%. Profit is earnings minus expenses incurred to generate those earnings, and in my mind, having to tie the boat literally outside my place of work, is an expense I would otherwise not have to pay.

[Ex- Member]

If you're paying 28% tax on £8500pa, you must have other substantial income already?

 

Just pay up & stop whinging.

 

Tim

 

Dean was offering a "scenario" not actual circumstance

[Arthur Marshall]

Have a look at http://www.taxinsider.co.uk/1028-Self_Employed_and_Working_Away_from_Home_Read_On.html%C2'> . This talks about a couple of judgements sort of similar. i think it might well be allowable. But you'd definitely need an accountant to argue the case... mind you, their fees are tax deductible as well...

If you're paying 28% tax on £8500pa, you must have other substantial income already?

 

Just pay up & stop whinging.

 

Tim

Self employed people pay tax at a diffrent rate to include adjustments for allces, NI and so on. Nobody actually pays tax at 28%, it just feels like it. He'd be paying 40% if he was earning a fortune.

[pendle]

I think if you were an MP you could claim the expense but if an ordinary pleb=no chance!!

[Ex- Member]

We're in a position where we're self employed and paye as well, so we can draw 20k per year between us tax free and avoid employers NIC on our PAYE wage which we limit to £15.912 between us. The other £4088.00 is drawn from our LLP company.

[tommytelford]

When I was self employed and living aboard most of the time my accountant advised me that I could claim a small proportion of the boat costs but if questioned I would have to be able to justify that cost to HMRC. At the end of the day the amount I could claim would 20% of very little so I was just too much trouble

[kevinl]

OMG Post 32 and you've finally answered the question "Yes I'm self employed." If when the question was asked more than once it would have been so much easier.

I can see you could argue that the marina costs are incurred 100% because you need to be where you are for the purposes of work and were it not for that reason you be able to moor for free on the towpath, they might argue that you derive some benefit or even that you could CC but it might work.

Like Tim said you shouldn't be paying tax at that rate, you say your income is £8,400 pa the current tax free allowance is £9,440 so no tax is due only a bit of NI you can't claim back anyway unless you have another income.

K

[Ex- Member]

OMG Post 32 and you've finally answered the question "Yes I'm self employed." If when the question was asked more than once it would have been so much easier.

I can see you could argue that the marina costs are incurred 100% because you need to be where you are for the purposes of work and were it not for that reason you be able to moor for free on the towpath, they might argue that you derive some benefit or even that you could CC but it might work.

Like Tim said you shouldn't be paying tax at that rate, you say your income is £8,400 pa the current tax free allowance is £9,440 so no tax is due only a bit of NI you can't claim back anyway unless you have another income.

K

 

Current tax free allowance is 10k

 

http://blog.thesalarycalculator.co.uk/tag/personal-allowance/

[kevinl]

 

Current tax free allowance is 10k

 

http://blog.thesalarycalculator.co.uk/tag/personal-allowance/

True, it went up last month.

K

[tillergirl]

Dean see if there anything on this link that is pertinent to your question

 

http://www.hmrc.gov.uk/webinars/self-employed.htm#6

[DeanS]

OMG Post 32 and you've finally answered the question "Yes I'm self employed." If when the question was asked more than once it would have been so much easier.

I can see you could argue that the marina costs are incurred 100% because you need to be where you are for the purposes of work and were it not for that reason you be able to moor for free on the towpath, they might argue that you derive some benefit or even that you could CC but it might work.

Like Tim said you shouldn't be paying tax at that rate, you say your income is £8,400 pa the current tax free allowance is £9,440 so no tax is due only a bit of NI you can't claim back anyway unless you have another income.

K

 

actually in post 1, I mentioned "my business" ?

I didnt say my income was £8400 pa . Tim did?

 

I have various sources of income, so my total tax is based on the total of those, but the question was specifically about having to moor somewhere to serve a single customer. In that light, I thought the marina fee could be tax deductible, as I would otherwise have the choice to CC. (my other incomes dont require a fixed location)

 

I have filled in self assessment forms for 5yrs, and pay a decent amount of tax.

[kevinl]

actually in post 1, I mentioned "my business" ?

I didnt say my income was £8400 pa . Tim did?

 

Gawd Dean you're hard work sometimes

I have a local maintenance job - you in post 1
I have a small job, ...pays £700 per month - you in post 19
to be able to fulfil a work contract. I'm not an employee of a company. - you post 21

You called it a job twice in post one although to be fair in a hypothetical context you did use the word "business" in post one but again in post 19 you called it a job and gave the income from it all Tim did was multiply it by 12. A few times it was said by me and others "if you're not self employed" or "as an employee" it took you til post 32 to say you are self employed and post 42 rest of the story.

So my advise now is that you may have the makings of a claim but you might be asked to prove before you started work in Manchester that you CCed and lived in effect for free and that when the contract ends you will go back to that lifestyle, that you derived no personal benefit from being in the marina and that the job requires you to be in that location. I think the claim on that basis has some legitimacy as a business expense.

K

[bassplayer]

I want to CC in the future, and have fitted out my boat to allow me to do it comfortably. Unfortunately, the rules of CC-ing state that I need to be on a continuous journey. As I have a local maintenance job, I'm not able to CC, but have to stay moored in the marina.

 

So long as you are prepared to move the boat every 14 days I don't see you have a problem going CC now. If you end up 20-30 miles away from your job then you could still commute using your chosen form of transport. You can use a bike, public transport, run, walk to get back to your vehicle after moving the boat. Could be a good excuse to keep fit.

 

Incidentally, if you earn less than £10k a year then you are tax exempt. I recon if you own your boat you should be able to live on that provided you have no dependencies other than food, boat running costs and reasonably priced second hand car costs.

 

BTW, do you own a house?

[Timleech]

Dean

 

If you were continuing to pay fees to another marina, and this is a short term contract of a few weeks or months which necessitates you being somewhere else and pay fees to a second marina, you might well be able to argue a good case. Otherwise, it seems as though you would just be trying it on. Being in a marina handy for your work is a convenience to you, and saves you on travel time and costs.

I've lived close to my main work for 30 years, should I have been able to claim my mortgage and other costs as a business expense? Yes I could make a case that I 'need' to be here, but it's also saved me a potentially massive amount in travel in that time. Such a claim would IMO be ridiculous and laughed out by the accountants and revenue.

 

Tim

Edited May 25, 2014 by Timleech

[tagulablue]

Don't know if this is any help ... when we were in business our tax accountant used to claim a percentage of costs inc. marina fees because we used to sometimes invite clients down for the day. She's now self employed but used to work for the tax office. It may be worth paying for proper advice.

[craftycarper]

It is also common practice according to my accountant for people with caravan,s to put them down as a mobile office / accommodation and put all there fees against tax you are only in the area to serve that one firm so would think you could do the same ,would also say go and have a chat with an accountant as they would be the only one that can tell you for sure they won't charge you for a chat and it's better to know the truth now rather than at the end of the year, as a bloke on a forum told me I could won,t really cut it

[DeanS]

 

 

Gawd Dean you're hard work sometimes

 

 

LOL. I know. forgive me

At the moment I wouldnt claim the marina as a tax expense, as my wife has a local job too (employee). I am thinking however, that WHEN, she no longer works as an employee, AND, my kid has left for Uni, that the only reason I would then incur the marina fee, is because I have to stay and provide a local service myself, to a single customer...

 

OR,

 

I could not service that customer, and go CC-ing.

 

It's quite a decision to make actually, as IF a marina fee is tax deductible, it makes an argument, financially, for staying and servicing that customer. However if it's not fully tax deductible, then I dont really make enough profit from that single customer to warrant it.

 

time will tell

Edited May 25, 2014 by DeanS

[plainsman]

 

that's a bit of an assumption, and a bit harsh Your answer has zip to do with answering the genuine question I posted. ...and I'm not whinging.

 

Thanks Arthur! Yes I'm self employed, so I pay 20% of profits, plus 8% NI tax, = 28%. Profit is earnings minus expenses incurred to generate those earnings, and in my mind, having to tie the boat literally outside my place of work, is an expense I would otherwise not have to pay.

 

Hmmmm I am employed and I pay 20% of my earnings plus NI =28% My profit is also earnings minus expenses (travel to work, car park, car upkeep, wear and tear on my suit etc) incurred to generate those earnings. The tax liability rules apply to all my earnings and disregard and expenses/costs to generate those earnings. Why am I treated differently to a self employed person?

[bag 'o' bones]

If your not actually using the boat *specifically* as part of your business other than being a convenient place for you to live near your work then I think you will have difficulty convincing the revenue that it is a legitimate business expense.

 

When I used to run a pub business my daily driver was a van. I was able to claim 75% business use. The other 25% was classed as private use with full taxes incurred.

 

Put your idea past an accountant, they will have a far better idea than anyone on here!

Edited May 25, 2014 by bag 'o' bones