Those MPs and Their Expenses Claims

Wow what a week or so it has been for our elected Members of Parliament!

As expressed by many living in the real world, the expenses situation is out of control and needs drastic action to take place immediately.

As the Director of a small business, I cannot see how the present system has been allowed to exist as there are clear and concise rules as to what can be legally claimed in expenses. The system is somewhat complex and dealing with it can take a lot of effort. Myself and all my employees know that no expenses will be paid unless receipts and a full justification is present – I have no choice but to make sure everything is in perfect order as if not, as the Company Director, I could end up in prison for tax fraud.

All our salaries are liable for income tax and the existing rules clearly define that we can only be reimbursed for genuine expenses incurred when carrying out our contracted jobs i.e. travelling expenses, hotel costs when working away from home and so on. These expenses do not have a net income and therefore they cannot be taxed. You cannot claim travel between your home and your regular place of work i.e. your commute and personal vehicle use is regulated and limited to 40 pence per mile and claiming for anything above this is illegal under the tax office rules. Any provision of goods deemed to be beyond what is reasonably needed for your actual work falls into the category of “payment in kind” and therefore becomes taxable. May I suggest that the Inland Revenue make arrangements as quickly as possible to investigate underpayment of tax from those Members of Parliament that have flouted these rules.

Whilst many of the items these MPs have claimed for are verging on the ridiculous, I suspect it is the rules that are at fault and not necessarily all of the claimants. They just took advantage of the situation and therefore their ethical and moral judgements must be questioned.

Unfortunately, it is clear that if the expenses policies had not been created by the MPs themselves, many of them would not be in the chaos that they are now.