Business expenses
3rd May 2012, Page 15
3rd May 2012
Page 15
Page 15, 3rd May 2012
— Business expenses
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When it comes to what is counted as a business expense for tax purposes, HMRC says you can get tax relief for your business expenditure so long as it’s not: ● capital expenditure; ● specifically non-allowable (e.g. entertaining expenditure).
However, to be allowable expenditure, it must be ‘wholly and exclusively’ for carrying on and earning the profit of a business. This means that the sole purpose for the expenditure must be a business purpose.
An operator can deduct the full amount of an allowable business expenditure from its business income to work out taxable profits.