M.K Cleaners.co.uk
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So I asked me accountant about it. This is what he said>>
Hi Marc your right to point out that this is one of the trickier areas of tax law and there are mixed views regarding this. Generally, with a few exceptions there is no difference regarding the deductibility of expenses between a Ltd comp
any or a sole trader, the 'wholly an exclusively' test applies to both entities.
There are exceptions however to the 'wholly & exclusively' rule, for example motor expenses with private use, strictly speaking the expense is not 'wholly and exclusively' for business purposes, however, it Is accepted that the expense can be claimed with a restriction for private use.
As for subsistence, if the nature of the trade is itinerant, i.e travel from different place to different place, you can buy food and drink to sustain you and you can claim the expense. If however, you work from a fixed establishment such as an office, it would be difficult to justify the expense, unless you are travelling on business. Your work is itinerant therefore there would be no difficulty making a claim. The exception is though, if you are working close to your home, you could go there for lunch etc and this element can't be claimed. I always say if you are within 10-20 minutes away from your home don't claim the expense. if you are further away than this, then buy a sandwich and claim the expense. The final point is you cannot claim for packed lunches.
There is no monetary limit on the amount you can spend on your lunch, however, it should be reasonable. Breakfast follows the same rules, but it would have to be a pretty early start. If you are working a very long day, it would be
possible to have an evening meal, and the rules are as above.
Hope this helps
Gary
Hi Marc your right to point out that this is one of the trickier areas of tax law and there are mixed views regarding this. Generally, with a few exceptions there is no difference regarding the deductibility of expenses between a Ltd comp
any or a sole trader, the 'wholly an exclusively' test applies to both entities.
There are exceptions however to the 'wholly & exclusively' rule, for example motor expenses with private use, strictly speaking the expense is not 'wholly and exclusively' for business purposes, however, it Is accepted that the expense can be claimed with a restriction for private use.
As for subsistence, if the nature of the trade is itinerant, i.e travel from different place to different place, you can buy food and drink to sustain you and you can claim the expense. If however, you work from a fixed establishment such as an office, it would be difficult to justify the expense, unless you are travelling on business. Your work is itinerant therefore there would be no difficulty making a claim. The exception is though, if you are working close to your home, you could go there for lunch etc and this element can't be claimed. I always say if you are within 10-20 minutes away from your home don't claim the expense. if you are further away than this, then buy a sandwich and claim the expense. The final point is you cannot claim for packed lunches.
There is no monetary limit on the amount you can spend on your lunch, however, it should be reasonable. Breakfast follows the same rules, but it would have to be a pretty early start. If you are working a very long day, it would be
possible to have an evening meal, and the rules are as above.
Hope this helps
Gary
