Self Employed Claiming Pay as You Go Mobile expenses

[glen82]

Hello,

Can anyone shed some light on what the rules are for claiming the expenses of a pay as you go mobile, as a self employed person, when the phone is used for both personal and business purposes.

I get no bills for this or itemised call logs - all I have is receipts for the top-up vouchers bought.

I'd estimate that up to 30% of calls are for business purposes in a month on average - I am wanting to just claim the business proportion of the top up vouchers, obviously not the whole value which includes personal use.

In addition to the use for calls, I chose a pay as you go plan with more data than I need for personal use (as when out and about being able to use the internet for work is really helpful/essential!) - so this aspect is a further expense.

The handset I use was also purchased with the above use in mind - can a proportion of this cost be claimed as an allowable expense too?

I know that, generally, the rules are that where there is duality of purpose the best practice is to keep call records, perhaps highlight on bills which calls are for business and work out as precisely as possible the business proportion of the bills. However, as it's a PAYG phone there are no bills, no access to a log of call records and I don't have the evidence to use. All I have is my knowledge of how the phone is used for my work, the top up receipts and a reasonable attitude to only wanting to claim for this proportion.

Can I claim this as a business expense from an HMRC perspective and what are the record requirements for this?

I called their 'help' line and got someone who just seemed to be making up the answers as he went along and gave me a load of 'perhaps' and 'should be' and 'might be' answers - which is ridiculous, when these people set the rules. Surely there is a written guide somewhere that gives more detail on allowable expenses that the scant overview on Gov.uk where it just mentions mobiles but no other information.

Thanks in advance for any help : )

Glen

 

[Scalloway]

I would keep your PAYG receipts and claim an appropriate percentage. Does your phone keep a record of calls made?

 

[glen82]

Thanks for your reply @Scalloway : ) . Yeh my phone keeps call logs of last numbers dialled etc. but I've had to factory reset it during the last year when it was playing up. Plus, there is no way getting those call records off the phone.

Anyone have anything else to add on this? Or know of more detailed written guidance from HMRC that I can look at?

 

[MBE1]

It would be much easier to use it for business only

 

[glen82]

It would be much easier to use it for business only

Tell me about it, but that is not the case - I have one phone used for personal and business use. It would also be more expensive if I had two mobiles wouldn't it.

As I have only proof of owning this one mobile this clearly wouldn't go down well with HMRC if they looked at my accounts and saw me claiming the lot now would they . . .

 

[MBE1]

Never been a problem for anyone I know personally, but obviously you have to be honest in such situations. I use a phone as a work tool only, ie have twin sims, one for business the other for personal.

 

[glen82]

That's a good idea for future reference. But for now I need to know what the rules actually are on the above . . .

: )

 

[Scalloway]

From here

https://www.gov.uk/expenses-if-youre-self-employed/overview

Your mobile phone bills for the year total £200. Of this, you spend £130 on personal calls and £70 on business.

You can claim for £70 of business expenses.

 

[Jenni384]

If you spend 30% on business, then claim 30% of your mobile phone costs. It's that simple

 

[glen82]

Thanks for the replies guys but I'm still no clearer on what EVIDENCE they will expect to do as Jenni384 says and claim the 30% - obviously I have the top up receipts but will they expect any evidence or support to back up how I came to the 30% figure - that's the bit that is impossible to provide.

Thanks : )

 

[Scalloway]

How much do you spend on top ups in a week? If I was looking at your books and querying the amount I would ask to see your phone calls made on your phone , ask who's numbers they are, see if you had billed them or they billed you.

Then wonder why I was wasting my time.

Unless you are claiming $000's a week producing PAYG receipts and a note of calls made should satisfy HMRC. They are never going to ask you to justify every single penny to get a few extra quid of tax off you.

 

[paulears]

With all proportional claims, isn't HMRC's usual take simply that up to a highish amount, they simply expect the charge to be reasonable? Without any definition. The simple solution would be to find a spare phone, put a PAYG sim in it and then you have a business and a mobile phone, and all calls on the business one would be legit, wouldn't they?

 

[Jenni384]

With all proportional claims, isn't HMRC's usual take simply that up to a highish amount, they simply expect the charge to be reasonable? Without any definition.

This has always been my understanding.
30% business is a very reasonable percentage and I would be very surprised if it was questioned.

 

[glen82]

Thank you guys for the above responses - very helpful. I am just being diligent to check what I am doing is reasonable and there's not any rules I'm not aware of : )