Passport renewal fee

[Enka]

Good afternoon,

I am trying to find online any details on how to treat a passport renewal fees for a director who paid it on a company credit card.
Can someone please share some links for HMRC guidance on this matter? If not, can you please share your view on this matter?

I believe this is not allowable business expense due to a personal element in it and the employee should pay it herself. Even if it's done on a last minute claiming that it was a work required trip.
Thank you.

 

[The Byre]

I can't see such a thing being an allowable business expense.

 

[lesliedocherty]

Not allowed, what is allowed if your work spring a trip on you short notice and you need to get a passport in a hurry they can pay for the expedited part of the charge, you still need to pay the normal passport fee.
Same with Cabin Crew, you pay the passport fee, your airline pay the expedited part, as you can't be without a passport for up to 6 weeks when getting renewed.

 

[DontAsk]

I had passport application fees covered, admittedly some years ago. I had never had a passport until that time and no intention to get one, so my employer had no choice but to pay for it (or else I couldn't travel).

Later attempts to get renewal fees re-imbursed on that same, expired, passport (again I had no intention of renewing until I needed it for myself) fell on deaf ears.

 

[Enka]

Thank you for your answers. I will read more about expedited part to make sure we treat this correctly.

The flight for this trip was booked at the end of November with travel mid March. The reason the director used the premium services (beginning of March) was a mixture of personal and work travel across the winter meant she couldn't risk being without the passport for the 3-4 weeks for standard renewal.

Also can the whole or partial fee for passport renewal be put through benefit in kind? What are your thoughts on this?
I am gathering as much information as I could. Thank you.

 

[Graham Tyers]

Passports are personal documents. The company wouldn't be able to take the passport back if the director were to leave. I would treat the spend as a personal spend that should be repaid to the company.

You could send a £60 grocery voucher to the director as compensation for having to renew a passport. That would be tax free and compensate the director mostly. I think you're allowed 4 of those a year.

There will be an accountant somewhere.

 

[Adam93]

The company can pay for it and claim a tax deductible expense, BUT it will be a taxable benefit on the director (and income tax and Class1A NIC will be due). It is irrelevant whether the director was going to get a passport or not it is the fact they have and as a result have received a benefit.

The trivial benefit rules are a maximum of £50 (with a limit of up to £300 per tax year for directors). The passport renewal fee is greater than £50 so is not covered by this.

The other option is to treat it as a loan from the company and clear it byway of a dividend (most would just treat the payment as a dividend which will get the same result).

 

[The Byre]

I am gathering as much information as I could. Thank you.

This entire issue and the effort being made to clarify this issue raises a VERY important point for every person in business.

This is a trivial issue and the difference between allowing it as a company expense (which it obviously is not, as a passport is something every normal person has to have) and the employee paying it is small. Yet it is tempting to drill down to the absolutely right decision.

And it doesn't stop there - daft expenses, such as £2 for a newspaper or £10 for a meal.

Time really is money. The person doing the books costs money, maybe £12 an hour, plus holidays, sickness pay, pension, etc., etc., etc. Add to that the cost for the canteen, car parking, heating, office chair, table, PC, time spent going to the loo and time spent staring out of the window, wishing it was Summer!

The answer for all of us is to spend an hour drafting some simple ground rules for what is and is not an allowable expense to be picked up by the company. Then stick to them!

Here's a perfect example of how to not deal with an idiotically trivial issue -

I am invested in a music school. An employee of my own company knocked over a saxophone that was the private property of an employee of the music school but failed to tell anyone. The sax was damaged. The manager of the school claimed that only someone from my company could have damaged the sax. Close questioning of the person who might have done it revealed that she had indeed knocked over the sax.

"OK, you did it, so you have to fess-up and we'll pay for any repairs! You deal with it!" said I.

The school manager even wrote a long letter to outline why and how she was convinced that one of my company's employees had done the dastardly deed. Imagining that the repairs would cost hundreds, our person wrote a long letter back. I won't give you all the details, but this nonsense dragged on for two weeks.

The sax was sent away for repairs. The sum in question was (wait for it!) - £20.

I was livid! I even shouted "Who the F wastes all that time and effort over £20? Dealing with who did what and when and to whom has cost us many multiples of £20!"

Don't waste time with absurdly trivial nonsense! Stike this idiotic claim for £60 from the table and leave it at that!

 

[MikeJ]

I've got two passports, and have had for about 20 years. They expire 5 years apart, and I claim every other one on expenses.

I only need the second one to enable me to apply for visas while I'm using the first one. I also tend to fill them up within 10 years, but (currently) I can continue to use it in Europe, and keep the unfilled one for destinations that stamp the passport.