self employed and claiming expenses
Discussion
If you are a "partner" in a "partnership", "partnership" expenses should be claimed through the "partnership" accounts - thereby reducing the "partnership" profits and your individual tax bill.
There is no mechanism for offsetting personal costs that you consider "business" related expenses outside of the partnership accounts.
You are not a "sole trader" and you are not an "employee".
There is no mechanism for offsetting personal costs that you consider "business" related expenses outside of the partnership accounts.
You are not a "sole trader" and you are not an "employee".
Eric, I didnt fully understand your reply. I am a partner in a partnership and all business costs are claimed through the partnership profits, such as rent, rates, heating stationary etc. My question is, can we claim the cost of ou clothing as a business expense. I suppose if we do they become an assett of the company?
Steve
Steve
That is slightly different to your original post - or at least, I can see now exactly whaty you're getting at.
The answer to all "is this expense claimable?" questions is to examine the Revenue's test - "was the expense incurred wholly and exclusively for the purpose of the trade?".
By and large, ordinary clothing (shirts, suits, normal shoes etc) are NEVER looked on as being "wholly and exclusively". The only clothing claims allowed tend to relate to:
designated uniforms (usually containing business names or logos)
overalls (speaks for itself)
protective clothing (helmets, goggles, steel capped boots, armoured gloves etc)
Cases involving claims for ordinary clothes have usually failed - even a claim for a barrister's wigs and a teachers gown was dismissed as failing the "wholly and exclusively" test - although these seemed quite clear cut claimable to me.
The answer to all "is this expense claimable?" questions is to examine the Revenue's test - "was the expense incurred wholly and exclusively for the purpose of the trade?".
By and large, ordinary clothing (shirts, suits, normal shoes etc) are NEVER looked on as being "wholly and exclusively". The only clothing claims allowed tend to relate to:
designated uniforms (usually containing business names or logos)
overalls (speaks for itself)
protective clothing (helmets, goggles, steel capped boots, armoured gloves etc)
Cases involving claims for ordinary clothes have usually failed - even a claim for a barrister's wigs and a teachers gown was dismissed as failing the "wholly and exclusively" test - although these seemed quite clear cut claimable to me.
Eric Mc said:
That is slightly different to your original post - or at least, I can see now exactly whaty you're getting at.
The answer to all "is this expense claimable?" questions is to examine the Revenue's test - "was the expense incurred wholly and exclusively for the purpose of the trade?".
By and large, ordinary clothing (shirts, suits, normal shoes etc) are NEVER looked on as being "wholly and exclusively". The only clothing claims allowed tend to relate to:
designated uniforms (usually containing business names or logos)
overalls (speaks for itself)
protective clothing (helmets, goggles, steel capped boots, armoured gloves etc)
Cases involving claims for ordinary clothes have usually failed - even a claim for a barrister's wigs and a teachers gown was dismissed as failing the "wholly and exclusively" test - although these seemed quite clear cut claimable to me.
While I know you are correct and I'm certainly not doubting your answer, I have never really got the "wholly and exclusively" thing. For example mobile phones, PC's, pens, etc etc can all be used personally but are allowable. Could you not apportion the use of the suit in the same way you might motor expenses (80% business use)?? The answer to all "is this expense claimable?" questions is to examine the Revenue's test - "was the expense incurred wholly and exclusively for the purpose of the trade?".
By and large, ordinary clothing (shirts, suits, normal shoes etc) are NEVER looked on as being "wholly and exclusively". The only clothing claims allowed tend to relate to:
designated uniforms (usually containing business names or logos)
overalls (speaks for itself)
protective clothing (helmets, goggles, steel capped boots, armoured gloves etc)
Cases involving claims for ordinary clothes have usually failed - even a claim for a barrister's wigs and a teachers gown was dismissed as failing the "wholly and exclusively" test - although these seemed quite clear cut claimable to me.
Re the infamous barrister case, didn't she claim for her suits and in the end was only allowed to claim for wigs?
"Wholly and exclusively" specifically allows dual purpose apportionment - especially in areas such as phone costs, motor expenses, subsistence etc.
As long as the PORTION of the cost being claimed is "wholly and exclusively" for the purpose of the trade, then that cost can be offset against business profits.
The Revenue have decided that it is virtually impossible to come up with a reasonable method of apportioning clothing costs - so they don't allow them at all (apart from the specific "business" clothing already mentioned).
As far as the barrister case is concerned, it's almost 30 years since I read that case so you may well be right..
As long as the PORTION of the cost being claimed is "wholly and exclusively" for the purpose of the trade, then that cost can be offset against business profits.
The Revenue have decided that it is virtually impossible to come up with a reasonable method of apportioning clothing costs - so they don't allow them at all (apart from the specific "business" clothing already mentioned).
As far as the barrister case is concerned, it's almost 30 years since I read that case so you may well be right..
Eric Mc said:
"Wholly and exclusively" specifically allows dual purpose apportionment - especially in areas such as phone costs, motor expenses, subsistence etc.
As long as the PORTION of the cost being claimed is "wholly and exclusively" for the purpose of the trade, then that cost can be offset against business profits.
The Revenue have decided that it is virtually impossible to come up with a reasonable method of apportioning clothing costs - so they don't allow them at all (apart from the specific "business" clothing already mentioned).
As far as the barrister case is concerned, it's almost 30 years since I read that case so you may well be right..
Are you talking about Mallalieu v Drummond?As long as the PORTION of the cost being claimed is "wholly and exclusively" for the purpose of the trade, then that cost can be offset against business profits.
The Revenue have decided that it is virtually impossible to come up with a reasonable method of apportioning clothing costs - so they don't allow them at all (apart from the specific "business" clothing already mentioned).
As far as the barrister case is concerned, it's almost 30 years since I read that case so you may well be right..
Expenditure on clothing to be worn in court by a female barrister was not deductible. Lord Brightman concluded 'she needed the clothes to travel to work and clothes to wear at work... it is inescapable that one object though not a conscious motive, was the provision of the clothing that she needed as a human being'.
I thought the revenue gave a concession for a certain number of shirts/suits per year for barristers? And the wig - surely you have to be joking? Where is the duality of purpose there?
Edited by soprano on Wednesday 27th February 14:24
soprano said:
Eric Mc said:
"Wholly and exclusively" specifically allows dual purpose apportionment - especially in areas such as phone costs, motor expenses, subsistence etc.
As long as the PORTION of the cost being claimed is "wholly and exclusively" for the purpose of the trade, then that cost can be offset against business profits.
The Revenue have decided that it is virtually impossible to come up with a reasonable method of apportioning clothing costs - so they don't allow them at all (apart from the specific "business" clothing already mentioned).
As far as the barrister case is concerned, it's almost 30 years since I read that case so you may well be right..
Are you talking about Mallalieu v Drummond?As long as the PORTION of the cost being claimed is "wholly and exclusively" for the purpose of the trade, then that cost can be offset against business profits.
The Revenue have decided that it is virtually impossible to come up with a reasonable method of apportioning clothing costs - so they don't allow them at all (apart from the specific "business" clothing already mentioned).
As far as the barrister case is concerned, it's almost 30 years since I read that case so you may well be right..
Expenditure on clothing to be worn in court by a female barrister was not deductible. Lord Brightman concluded 'she needed the clothes to travel to work and clothes to wear at work... it is inescapable that one object though not a conscious motive, was the provision of the clothing that she needed as a human being'.
I thought the revenue gave a concession for a certain number of shirts/suits per year for barristers? And the wig - surely you have to be joking? Where is the duality of purpose there?
Edited by soprano on Wednesday 27th February 14:24
Eric Mc said:
soprano said:
Eric Mc said:
"Wholly and exclusively" specifically allows dual purpose apportionment - especially in areas such as phone costs, motor expenses, subsistence etc.
As long as the PORTION of the cost being claimed is "wholly and exclusively" for the purpose of the trade, then that cost can be offset against business profits.
The Revenue have decided that it is virtually impossible to come up with a reasonable method of apportioning clothing costs - so they don't allow them at all (apart from the specific "business" clothing already mentioned).
As far as the barrister case is concerned, it's almost 30 years since I read that case so you may well be right..
Are you talking about Mallalieu v Drummond?As long as the PORTION of the cost being claimed is "wholly and exclusively" for the purpose of the trade, then that cost can be offset against business profits.
The Revenue have decided that it is virtually impossible to come up with a reasonable method of apportioning clothing costs - so they don't allow them at all (apart from the specific "business" clothing already mentioned).
As far as the barrister case is concerned, it's almost 30 years since I read that case so you may well be right..
Expenditure on clothing to be worn in court by a female barrister was not deductible. Lord Brightman concluded 'she needed the clothes to travel to work and clothes to wear at work... it is inescapable that one object though not a conscious motive, was the provision of the clothing that she needed as a human being'.
I thought the revenue gave a concession for a certain number of shirts/suits per year for barristers? And the wig - surely you have to be joking? Where is the duality of purpose there?
Edited by soprano on Wednesday 27th February 14:24
Edited by soprano on Wednesday 27th February 14:46
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