Madam, We have not seen the taxman drawing blood yet. All these expense claims which are not deemed 'fair and reasonable' should be paid back and the perpetrators fined for tax evasion.
However 'fair and reasonable' expenses are OK - I (and I'm sure the taxman) should have no trouble with that. However this episode has made me realise how much I have been missing out on. I plan to rectify this situation.
I noted that MPs can claim up to £250 per expense item unreceipted. So that got me thinking, although I will not be as greedy or cavalier as that. In our business we allow our staff about £35.50 a day (against receipts) for breakfast, lunch and dinner when out and away on company business. I have never claimed this "allowance" in the 22 years we have been trading. As the owner of the business I have decided that I will change the rules for me to not need receipts. I will also allow retrospective claiming. I probably spend about 60 days per annum out and about and arriving home after my dinner's in the dog!
So.... 22 years times 60 days times £35.50 equals £46,860. Now £46,860 tax free would be quite a tidy sum thank you very much. The other great thing is that being a higher rate tax payer that would save about £53,774 tax, employers and employees NI. Then of course the business would not have to pay corporation tax at 21% on the £46,860 - that's another £9,840.
About 50% of my activity is research and development (R&D) related. So for the last six years we have been utilising the R&D tax credits system whereby an additional 50% of tax credit is available. So six years times 60 days times £35.50 equals £12,780 times 50% at 21% tax is about £1.342.
So I reckon that's nearly £65,000 tax I and the business would not have to pay and I get £46,860 tax free!
Now (to quote many MPs over the last couple of weeks) I really don't think I am doing anything wrong, after all this is what the system allows me to claim...... and I'm only claiming for subsistence whilst out on genuine company business, no duck houses, plasma TVs, moat cleaning, etc.
Before I award myself these expenses - I would welcome an employee of HMRC to contact me and correct me if I'm wrong.
It's worth noting that my £65,000 tax saving is about the cost of one MP who gets paid £64,766 so we might also say that we have also invented a new tax metric - the 'taxMP'. How much tax or how many 'taxMPs' can you save by awarding yourself previously unclaimed expenses? They have to be 'fair and reasonable', remember.
Charles Curry, Upton Bishop