Tax law says that an expense is allowable for tax if it is incurred вЂwholly and exclusively for the purposes of the tradeвЂ™. If an expense is incurred for more than one purpose, i.e. business as well as personal use, a deduction for any identifiable proportion of the expense which is incurred вЂwholly and exclusively for the purposes of the tradeвЂ™ is allowable. We have set out some of the types of expenditure that may be allowable.
HMRC allows a certain proportion of using home as office depending on the time spent for the purpose of trade. We would normally consider the rateable value of the property which is being used for trade.
e.g. MDU, MPS, BMA, GMS, RCGP
HMRC always allow a tax deduction for the payment of professional subscriptions.
Motor expenses can be claimed on a car assuming it is used for the purposes of business. The expenses have to be apportioned so that only those incurred вЂwholly and exclusively for the purposes of the tradeвЂ™ are allowed. We will assist you in deciding how much your car is used for business travel (eg 80% business, 20% private)
This can then be applied to the total expenses for the year or period of assessment. Below is a list of expenses that can be claimed.
- Petrol and oil
- Repairs and servicing
- Road tax
- AA/RAC subscription
- Finance interest
Many other types of expenses can be claimed by Consultants. We provide our Consultant clients with detailed checklists and advice to ensure that all allowable expenses are claimed.