March 24. 2016
Sadly Easter Eggs are not an allowable
business expense.
This maybe a good time to mention some expenses
that are not allowed. In other words, those expense that do not meet the HMRC
test of ‘wholly and exclusively for business purposes.’
There are a whole raft of expenses that could be deemed allowable but in fact
are not. The most commonly asked about are:
-Personal insurance and sickness policies. It probably makes sense to
have such insurance but unfortunately the costs are not an allowable business
expense. The fact that they are personal expenses is a bit of hint.
-Work clothes and shoes. You may quite rightly claim to your accountant:
‘I have to look good whilst I teach’. True, but so do most people who go
to work in any professional capacity and they have to personally pay for their
suits, shirts and ties. It is no different for a driving instructor or any
other similar profession. However, shirts and tops are allowed for tax
purposes if they display a prominent logo promoting your business. Shoes
are a definite no: we all have to wear shoes.
-Spectacles and eye tests. This is an interesting one but at the end of the day
we all have to take regular eye tests, wear glasses if required, and pay for
them personally. The same applies to sunglasses.
The list of non-allowable expenses is understandably endless. Some of the
strangest requests that have made the non-allowable list include chewing gum,
gym membership and solar panels.
Making a claim for an expense that is not allowed for tax purposes on your tax
return could land you in hot water with HMRC if they investigate the detail of
your return. Usually the cost to you of that investigation will be far in
excess of the expense you were endeavouring to offset against tax. Seek
expert advice before deciding whether to include an item on your tax return, if
you are not 100% sure about it. Call us 0344 984 2515!
What about a chocolate calculator then??
Happy Easter....
