MP's Accountancy Fees and Tristram Hunts Income and Expenses

I read with interest about MP's making claims for reimbursement of Accountancy fees from the Independent Parliamentary Standards Authority (IPSA).  One of the prominent names mentioned was Tristram Hunt, Labour Member of Parliament for Stoke on Trent Central, and, Shadow Secretary of State for Education.  Part of the details line in the submission of his accountancy fees claim states "Accountancy for income tax return".  In practice the income tax return refers to the Self Assessment form sent out by HM Revenue and Customs (HMRC) each year.  The furore created over this claim relates to the eligibility of it being a legitimate expense.  Indeed the IPSA Annual Review of MPs' Scheme of Business Costs and Expenses 2013, states on page 23, paragraph 6.6 (e) that "personal accountancy or tax advice" may not be claimed.  In addition the HMRC booklet on Tax and National Insurance contributions Guide for MPs and Ministers also states on page 16, annex 1, that "accountancy fees incurred in the preparation of Self Assessment tax return or related expense claims" are not allowed as tax expenses.  It should be stated that claiming and being reimbursed for the expense from IPSA is totally different from entering it as an expense on the HMRC self assessment form, and, one does not necessarily follow the other.

In order to gain a further understanding as to why MPs may have the need of accountancy services I thought it maybe useful to see what income and expenditure they have in addition to the basic salary of £66,396 plus additional allowances where applicable.  To assist with the income side of the equation the House of Commons publishes The Register of Members' Financial Interests.  Its main purpose "is to give public notification on a continuous basis of those financial interests held by Members which might be thought to influence their parliamentary conduct or actions".  The register is a lengthy document totalling some 326 pages.  Under Tristram Hunts entry the following types and amounts of income sources are listed from 1st April, 2013:

Remunerated Income	Amount (£)	Hours Worked	Hourly Rate (£)		Comments
Salary as a Lecturer	8,662.88	128	67.68		16 hours per month paid gross
Guardian News & Media Ltd	2,800.00	11.5	243.48		7 payments for articles
The Spectator	690.00	3	230.00		2 payments for articles
Capel & Land, Literary Agents	14,920.17	50	298.40		Book royalties, etc.
BBC	70.00	0.75	93.33		Payment for interview
MGN Ltd (Mirror Group)	600.00	3	200.00		1 payment for articles
Immediate Media Company Bristol Ltd	200.00	1	200.00		Articles BBC History Magazine
News International Trading Ltd	800.00	4	200.00		Articles Times newspaper
Evening Standard	240.00	2	120.00		1 payment for articles
Art Fund	1,000.00	7	142.86		Payment for judging award
Martin Randall Travel	400.00	3	133.33		Fee for lecture
Keele University	320.00	3	106.67		Fee for lecture
Total Remunerated Inc.	30,703.05
Sponsorship
Peter Coates	9,000.00				Donation to constituency party / association
Gifts, benefits and hospitality
Civitas, the Institute of Civil Society	10,000.00				Donation of 840 history books to constituency primary schools
Overseas Visits
Labour Friends of Israel (Payment of Air Fares & hotels)	1,800.00				Fact-finding visit to Israel and the Palestinian territories with defence and security focus

As you can see from the above Tristram Hunt earns a substantial additional income in addition to his salary.  This also may not be the full picture either of his annual finances, as the above is only what has been reported which may influence his parliamentary conduct or actions.  In addition there maybe investment income (shares, investments, trusts, etc.)  It can be seen that complexity is starting to occur, which may require the services of an accountancy expert.

MPs are also entitled to reclaim expenses incurred in the performance of their duties in being an elected representative.  Common types of expenditure are the costs of accommodation in London, and, of running a constituency office.  These expenses are administered by IPSA, who publish the data periodically on their website.  Again for Tristram Hunt I have extracted the data, for the latest available in the current financial year (upto September 2013), and, for the whole of 2012/13.  The information is given below:

	2012/13		2013/14
Accommodation Rent	10,200.00		5,100.00
Council Tax	1,269.96		1,269.96
Electricity	511.90
Gas	818.58
Other Fuel			199.03
Television Licence	145.50
Water	152.14		68.11
Total Accommodation	13,098.08		6,637.10
Business Rates	528.75		542.85
Computer HW Purchase	1,791.50
Const Office Buildings Insur.	160.12
Const Office Electricity	322.30		185.95
Const Office Gas	647.65		408.70
Const Office Rent	6,032.61		2,500.00
Const Office Tel. Usage/Rental	2,716.83		1,109.18
Const Office Water	174.45		119.12
Furniture Purchase	64.75
Install/Maint Office Equip.	981.13		928.76
IT/Other Equipment Hire			30.00
Newspapers/Journals	201.00		382.00
Other	27.72		135.99
Other Equip Purchase	18.28		23.96
Parliamentary Accountancy	378.00		420.00
Professional Services	330.00		42.00
Software Purchase	700.00
Stationery Purchase	3,005.73		1,065.14
Tel/Mobile Purchase	97.93
Training MP Staff	597.00
Total Office Costs	18,775.75		7,893.65
Congestion Zone/Toll	11.00		11.00
Food & Drink @ Parliament	244.25		68.15
Hotel London Area MP Staff	526.20
Own Vehicle Car	779.85		142.47
Own Vehicle Car MP Staff	754.93		541.43
Parking			2.50
Parking MP Staff			8.00
Public Tr BUS MP Staff	1.65		2.00
Public Tr RAIL - RTN	7,173.00		2,041.50
Public Tr RAIL - SGL	486.80		133.30
Public Tr RAIL Dependant - RTN	132.00
Public Tr RAIL MP Staff - RTN	1,385.40		587.70
Public Tr RAIL MP Staff - SGL	128.45
Public Tr RAIL Other	0.00
Public Tr UND MP Staff			19.10
Taxi	6.50
Taxi After Late Sitting	32.00
Taxi MP Staff			4.60
Taxi Working Late After 9pm	101.00
Total Travel	11,763.03		3,561.75
Grand Total	43,636.86		18,092.50

Again the full year costs add up to a substantial sum.  The "dreaded" accountancy fees appear under the office costs section.  It has to be noted that they have been allocated a specific expenditure heading, so IPSA must have had some kind of accountancy service in mind when they set up the expenses system.  Presumably when the claims were authorised, some checks were undertaken to substantiate it was legitimate expenditure.  All in all though from this example alone it can be seen that there are certainly a number of different financial sources which have to be managed and administered.