Little known allowables against tax
Discussion
Anybody know any LEGAL and acceptable things that can be seen as a business expense, but which others may have missed.
I would hate to think I was missing anything. We have had the staff party @£150 a head, was thinking about a nice conference somewhere warm, but Mr IR seems to have everyting else sewn up.
Ideas please that won't get me locked up.
E.g.
I had a mate who claimed food for his dog because he had a garage and during times when there were local burglaries the dog stayed overnight in his garage. Tax man seemed to accept it.
I would hate to think I was missing anything. We have had the staff party @£150 a head, was thinking about a nice conference somewhere warm, but Mr IR seems to have everyting else sewn up.
Ideas please that won't get me locked up.
E.g.
I had a mate who claimed food for his dog because he had a garage and during times when there were local burglaries the dog stayed overnight in his garage. Tax man seemed to accept it.
MOST expenses incurred "wholly and exclusively for the purpose of the trade" will be allowed as business costs - with the odd exception.
Client, customer or supplier entertainmnent are completely barred - even if they were genuinely incurred for the business.
Staff entertainment is allowed up to certain limits and normally does not include costs incurred in respect of partners or spouses.
Pension contributions for staff and directors of companies are allowed provided the pension is an Inland Revenue approved pension.
Sole traders normally do not claim pension contributions as a business cost. The correct way for them to claim for pension contributions is by using the "Pensions" section of the Self Assessment tax return form.
If you run your business from home you are allowed claim a proprtion of domestic costs as business expenses e.g. electricity, gas, home and home contents insurance, council tax and water charges. They are usually grouped together under one heading called "Business Use of Residence" or "Use of Home as Office".
If you have a spouse who has no other significant source of income, you might want to consider paying him/her a wage through your business. If you keep the salary below the National Insurance threshold and there are no other employees you will not have to register the business for PAYE. However, to justify the salary payments two criteria must be met
i) the salary has genuinely to be paid (preferably weekly or monthly) and
ii) the spouse must have a genuine role of work in the enterprise.
Client, customer or supplier entertainmnent are completely barred - even if they were genuinely incurred for the business.
Staff entertainment is allowed up to certain limits and normally does not include costs incurred in respect of partners or spouses.
Pension contributions for staff and directors of companies are allowed provided the pension is an Inland Revenue approved pension.
Sole traders normally do not claim pension contributions as a business cost. The correct way for them to claim for pension contributions is by using the "Pensions" section of the Self Assessment tax return form.
If you run your business from home you are allowed claim a proprtion of domestic costs as business expenses e.g. electricity, gas, home and home contents insurance, council tax and water charges. They are usually grouped together under one heading called "Business Use of Residence" or "Use of Home as Office".
If you have a spouse who has no other significant source of income, you might want to consider paying him/her a wage through your business. If you keep the salary below the National Insurance threshold and there are no other employees you will not have to register the business for PAYE. However, to justify the salary payments two criteria must be met
i) the salary has genuinely to be paid (preferably weekly or monthly) and
ii) the spouse must have a genuine role of work in the enterprise.
If you launder (at home) company-logo'd clothing, you get an (admittedly pathetic) allowance... well I do anyway 
So, get a corporate-logo-clothing manufacturer to knock you up a couple of free shirt samples (and they will) then get the boss to sign a letter saying that you wash your own kit and hey presto. If you ARE the boss, so much easier
Note that I DO actually wear logo'd gear, not just free samples. I also manage to claim a pair of safety boots and several other items of workwear back off the company each year (ISTR the boots thing is a standard practice in industry).
So, get a corporate-logo-clothing manufacturer to knock you up a couple of free shirt samples (and they will) then get the boss to sign a letter saying that you wash your own kit and hey presto. If you ARE the boss, so much easier
Note that I DO actually wear logo'd gear, not just free samples. I also manage to claim a pair of safety boots and several other items of workwear back off the company each year (ISTR the boots thing is a standard practice in industry).
You are allowed claim for specific work clothes - uniforms, boiler suits, safety clothing etc and the cleaning and maintenance of such clothing. However, you are NOT allowed claim for normal everyday clothing, even if you did buy it with work in mind. Therefore, suits, ordinary shoes, jeans etc should not really be claimed for.
Eric: given the punitive nature of taxation in all its many forms in this country, is at any surprise that everyone from the shop floor to Directors finds any way they can to claw a little something back?
It's not as thought the country is grinding to a halt because a few company chiefs are generous enough to buy their staff a pair of £10 bloody trousers, in the sure and certain knowledge that they're going to get covered with oil, dirt or ripped on a raggy corner.
I appreciate that 'there are rules' but there are for just about everything, including what you can or cannot post on a website and frankly it makes for a tedious, sheep-like existence.
In a moment of madness I registered a company but I have yet to pluck up the courage to open myself up to the onslaught of 'rules' that I'll have to obey in order to further line the government's pockets... sorry, sorry, I mean 'bolster the British economy, make a worthwhile contribution to society and gain personal satisfaction and wealth'...
It's not as thought the country is grinding to a halt because a few company chiefs are generous enough to buy their staff a pair of £10 bloody trousers, in the sure and certain knowledge that they're going to get covered with oil, dirt or ripped on a raggy corner.
I appreciate that 'there are rules' but there are for just about everything, including what you can or cannot post on a website and frankly it makes for a tedious, sheep-like existence.
In a moment of madness I registered a company but I have yet to pluck up the courage to open myself up to the onslaught of 'rules' that I'll have to obey in order to further line the government's pockets... sorry, sorry, I mean 'bolster the British economy, make a worthwhile contribution to society and gain personal satisfaction and wealth'...
Eric Mc said:
If you run your business from home you are allowed claim a proprtion of domestic costs as business expenses e.g. electricity, gas, home and home contents insurance, council tax and water charges. They are usually grouped together under one heading called "Business Use of Residence" or "Use of Home as Office".
I could be wrong on this one, but I thought there was a potential problem down the line with this one. I was under the impression that if you claimed, for example 10% of home expenses, then when you came to sell the propery you could be hit with capital gains on the 10% - as it wasn't really 'your home' but was an office for which you'd had tax relief. Maybe worth checking....
WB
tvrolet said:
If you run your business from home you are allowed claim a proprtion of domestic costs as business expenses e.g. electricity, gas, home and home contents insurance, council tax and water charges. They are usually grouped together under one heading called "Business Use of Residence" or "Use of Home as Office".
I could be wrong on this one, but I thought there was a potential problem down the line with this one. I was under the impression that if you claimed, for example 10% of home expenses, then when you came to sell the propery you could be hit with capital gains on the 10% - as it wasn't really 'your home' but was an office for which you'd had tax relief. Maybe worth checking....
WB
I think the CG issue relates to charges such a s council tax, as opposed to legitimate costs such as apprortioned heating etc. I did a litle test period noting down which rooms were in use and for what and then apportioned the monthly bills accordingly.
Sad that the greatest minds in cyber space can't come up with anything more than logos on T shirts and safety boots. Indicative of the strangle hold that Mr IR has on us I fear, and tha fact that over the years people have tried it on a bit too much.
shirepro said:
I think the CG issue relates to charges such a s council tax, as opposed to legitimate costs such as apprortioned heating etc. I did a litle test period noting down which rooms were in use and for what and then apportioned the monthly bills accordingly.
It is indeed, use of home as office is only supposed to cover you for the additional costs of heating, lighting and powering any work you do at home.
You could set up a seperate work area at home, and allocate a proportion of the mortgage and council tax to the business, but then when you came to sell the home a proportion of the proceeds might well be assessed to capital gains tax.
shirepro said:
Sad that the greatest minds in cyber space can't come up with anything more than logos on T shirts and safety boots. Indicative of the strangle hold that Mr IR has on us I fear, and tha fact that over the years people have tried it on a bit too much.
You are looking at things from the wrong perspective, not all expenses could resonable be claimed by all businesses. A good accountant would claim as much as possible for the specific business in question.
Claiming a percentage of domestic costs as legitimate business expenses should have no effect on the council tax you have to pay on your home and should have no Capital Gains Tax either.
Council Tax could be affected if the business you were carrying substantially altered the look of your home or affected the environment around your home. Certainly, if this was the case the local council could try to stop you carrying on the business from your premises - on the basis that you would needed separate planning permission to continue running the business from that location.
As far as Capital Gains Tax is concerned, as long as no substantial changes are made to the property (i.e. converting a garage to a surgery or workshop) there should be no problem. Merely administering yourb businesss from home and using one of the existing rooms in the house as an office will have no CGT consequences.
Council Tax could be affected if the business you were carrying substantially altered the look of your home or affected the environment around your home. Certainly, if this was the case the local council could try to stop you carrying on the business from your premises - on the basis that you would needed separate planning permission to continue running the business from that location.
As far as Capital Gains Tax is concerned, as long as no substantial changes are made to the property (i.e. converting a garage to a surgery or workshop) there should be no problem. Merely administering yourb businesss from home and using one of the existing rooms in the house as an office will have no CGT consequences.
Eric Mc said:
Funny how people are patriotically willing toi give their lives for their country but find paying "money" a problem.
The rules are there and it is up to every citizen whether they wish to act as "criminals" and flout them or not.
We all have a life to give, if we so choose. Not many of us have any money, thanks to the 'system'...
>> Edited by wedg1e on Sunday 18th September 23:00
wedg1e said:
Funny how people are patriotically willing toi give their lives for their country but find paying "money" a problem.
The rules are there and it is up to every citizen whether they wish to act as "criminals" and flout them or not.
We all have a life to give, if we so choose. Not many of us have any money, thanks to the 'system'...
>> Edited by wedg1e on Sunday 18th September 23:00
Says a man with a TVR and Lotus on the drive
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