The 24-month rule, also referred to as the two-year rule, enables contractors to claim travel expenses from their home to a client's office, as long as it is classed as a "temporary workplace".
The following conditions must apply for a work location to be classed as a "temporary workplace"
- The period of engagement is less than 24 months
- The contractor should spend less than 40 percent of their time at the workplace
Essentially, if you work at the client's office for more than 24 months, or spend more than 40 percent of your time at the location, it is considered a permanent workplace-and as such, you won't be able to claim travel or subsistence expenses.
Bear in mind that this is subject to the SDC legislation introduced in April 2016. Further elaboration on SDC can be found in our guide to claiming expenses as an umbrella company contractor.
<p>The 24-month rule, also referred to as the two-year rule, enables contractors to claim travel expenses from their home to a client's office, as long as it is classed as a "temporary workplace". <br></p><p>The following conditions must apply for a work location to be classed as a "temporary workplace"</p><ul><li>The period of engagement is less than 24 months</li><li>The contractor should spend less than 40 percent of their time at the workplace<br></li></ul><p>Essentially, if you work at the client's office for more than 24 months, or spend more than 40 percent of your time at the location, it is considered a permanent workplace-and as such, you won't be able to claim travel or subsistence expenses. <br></p><p>Bear in mind that this is subject to the SDC legislation introduced in April 2016. Further elaboration on SDC can be found in our guide to <a href="https://goforma.com/contractors/claiming-umbrella-company-expenses" target="_blank">claiming expenses as an umbrella company contractor</a>.</p>
Our small business accounting guide walks through absolutely everything you need to know if you're considering starting a limited company. From different taxes, limited company advantages/ disadvantages, how to pay yourself, and what your key filing requirements are.
- When to register a Ltd company
- When to register for VAT
- How to take money out of your company
- Dividend tax rates
- Limited company expenses & corporation tax
- Annual accounts and deadlines
Read more of our Small Business Accounting guides:
Book a free consultation to learn more about your directors expenses and allowances.
Our limited company expenses guide talks through all the different expense categories you can claim for along with key examples and how this can impact your corporation tax.
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