My question is around any expenses claim I can make. Some of the other contractors I'm working with are claiming travel expenses for the daily trip to and from the office and have been on contract for nearly a year now. They are also claiming for daily subsistence. One of the guys has set up as a sole trader and in invoicing a company that he is a director of.
Brouhahaha is spot on. Travel to your place of work if you are on-site virtually all of the time (as most contractors are) is not claimable. Irregular travel, occasional trips to a client site, bank, accountant, is all claimable. The rate is based on your car and your accountant can advise you on the correct rate, or you can get it from the Revenue Site. (I always run things by the accountant even if Revenue tell me something).
If it will help here's how I operate:
I pay myself a regular monthly wage, regardless of how many hours I work in a given month. It's much simpler to pay yourself the same amount, and pay revenue the same amount each month. I try to keep my wages small to maximise the profits of the company, and then I try to get the profits out of the company in the most tax efficient methods I can.
As for expenses I go with receipts or visa statement and I only expense exactly what I spent. I believe there are standard allowances that can be paid as an alternative to this vouched method, but you must pick one way or the other.
I fill out an expense statement once a month from me to the company listing the expenses I'm owed. I then write a cheque from the company to me for the amount of the expenses. It's as simple as that.
You are correct as a director of a Ltd company you have certain advantages in the area of Tax planning, and Pension planning. If you can clear about 20K profit a year after paying yourself and covering expenses then you might consider a Self Administered Retirement Trust. Check out
WWW.FEN.IE for more info on that. There are other Pension options too, but SART's are very attractive if you can generate a lot of profit, and you see contracting being a long term situation.
The number 1 thing you need above all else is a good accountant.
I have seen all sorts of strange behaviour by IT contractors over the years and I would question the legality of some of the things I've seen. I've never heard of an IT Contractor being audited.
There are stories of AGM's being held in Orlando, Rome, Paris etc. where husband and wife are the board of directors. I don't know if any of these stories are true.
I do scan the list of international software conferences regularly to see if there are any exotic locations that I'd like to visit on the company dime so to speak. Next year I hope to spend a month in Chile studying salmon fishing.
-Rd