Can someone please clarify rules around subsistence - meal allowance

[SueEllen]

Context is important here. Just because there are cases where buying a coffee and snack whilst travelling is legitimate it doesn't mean all cases are.

If you're on a long business journey then IMO any food and drink purchased while travelling is fine.

If you're commuting an hour into London, have already had breakfast before you left and are just buying a coffee because you like coffee then IMO its not "necessarily" incurred.

Having said that, if somebody wants to interpret it the rules as being "all subsistence purchased whilst on a business journey is OK" then I wouldn't get too worked up about it.

Maybe buy less coffee.

Posters are getting worked up by the arbitrary rules their accountants apply.

It would help if they said whether their accountant actually knew what kind of travelling they were doing.

I've had to point out to my own in the past why my T&S costs have gone up or down.

[GB9]

This needs to be filed in the myth drawer alongside the one (propagated elsewhere in this thread) about not claiming T&S if travelling from home because being 'commuting' it upsets HMRC and is why they hound us for IR35.

Well, I was told this by an Inland Revenue member of staff but it could of course have been their own take on it.

[GB9]

Whilst I've staunchly defended the right to claim meals taken whilst working at a temporary workplace (including lunch), the key thing to remember here is that it has to be "necessarily" incurred.

Easy enough to claim that any regular meals are necessarily incurred, because you have to eat. So IMO, that makes lunch fine if you're there during the day, breakfast fine if you have to leave home early and dinner fine if you stay late.

I'm not sure you can quite so easily make the case that your coffee and muffin habit is "necessarily" incurred in the performance of your duties though so I can see why your accountant is cautious. I'm not saying its black and white but a matter of an interpretation over what is "necessarily" incurred whilst travelling.

As I stated earlier, I always claim lunch, which might be a coffee and a muffin if there's nothing better available, but I've never claimed any coffee or snacks I've bought on the way to or from work, because IMO its my choice to buy them and they certainly aren't necessary.

Firstly, I'm not claiming muffin allowance!

The point I'm trying to make (albeit poorly) is that the rules contradict. I would tend to go down the route of everything should be claimable whereas others seem to think nothing should be.

My argument about coffee is that is seems reasonable that additional expense incurred as a result of business should be claimable (even if it isnt). Examples:

I have a mid morning coffee. At home it costs 10p. Due to being on a client site it costs £2.50. The additional expense is incurred solely as a result of doing business.

I own a car. It sits on my driveway and costs nothing in parking charge. I go to client and have to pay £8 to park. This increased cost is incurred solely as a result of doing business. It seems to be a legitimate expense.

Logically I can't see the difference myself.

[northernladuk]

Firstly, I'm not claiming muffin allowance!

The point I'm trying to make (albeit poorly) is that the rules contradict. I would tend to go down the route of everything should be claimable whereas others seem to think nothing should be.

My argument about coffee is that is seems reasonable that additional expense incurred as a result of business should be claimable (even if it isnt). Examples:

I have a mid morning coffee. At home it costs 10p. Due to being on a client site it costs £2.50. The additional expense is incurred solely as a result of doing business.

I own a car. It sits on my driveway and costs nothing in parking charge. I go to client and have to pay £8 to park. This increased cost is incurred solely as a result of doing business. It seems to be a legitimate expense.

Logically I can't see the difference myself.

Firstly HMRC don't do logical or reasonable thinking. It's black and white however wrong.

Secondly the cost of stuff is what doing business is all about? Can I claim things in the south that I can't in the north because its so much more expensive? The cost of something varies so you adjust your models to suit. If something costs 3 times more to source in the UK than China does that mean I can claim tax against it because it's more? That's just dumb.

The difference in price is the cost of doing business which you factor in to your charges. It is not and can no way be part of the equation as to whether you can claim tax on it. How many more times.

And has already been mentioned... You don't HAVE to have a coffee so it's your choice, not business driven. And the car on the drive way vs client parking example? What are you trying to prove there? Your parking at client was incurred soley for the gig so I don't think anyone is arguing that.

Stop thinking about stuff costing more. It's irrelevant. Think about wholly and exclusively first and then work back from there.

[pr1]

Firstly, I'm not claiming muffin allowance!

The point I'm trying to make (albeit poorly) is that the rules contradict. I would tend to go down the route of everything should be claimable whereas others seem to think nothing should be.

My argument about coffee is that is seems reasonable that additional expense incurred as a result of business should be claimable (even if it isnt). Examples:

I have a mid morning coffee. At home it costs 10p. Due to being on a client site it costs £2.50. The additional expense is incurred solely as a result of doing business.

I own a car. It sits on my driveway and costs nothing in parking charge. I go to client and have to pay £8 to park. This increased cost is incurred solely as a result of doing business. It seems to be a legitimate expense.

Logically I can't see the difference myself.

Without the car (or other means of transport) you couldn't get to your client, I don't think that's disputable

Whether or not you need a coffee to do your job/deliver your project is a lot more subjective, I think

[TheCyclingProgrammer]

Think about wholly and exclusively first and then work back from there.

Except the test is wholly, exclusively and necessarily and the test is applied to the *travel* - the rules, and HMRC guidance confirms, that if the travel passes the test (as a result of applying the numerous rules relating to business travel and temporary workplace), then so should the subsistence and accommodation. You don't also apply the test to the subsistence and accommodation on their own.

If the subsistence and accommodation is not related to a business journey then you can apply the test in isolation and it fails, which is why these things on their own are not tax deductible expenses, as you need to eat and you need somewhere to live.

But when it relates to a business journey its treated as a special case.

The only potential grey area is whether or not subsistence is "necessarily incurred" as a result of a business journey and I don't think HMRC define this in any great detail. If you need to purchase some food or drink on a business journey then its probably reasonable to claim it. But I also accept that claiming your £20/day latte habit as a business expense - just because you're travelling on business - is probably taking the piss. All it needs is a bit of common sense applied.

[FrontEnder]

Without the car (or other means of transport) you couldn't get to your client, I don't think that's disputable

Whether or not you need a coffee to do your job/deliver your project is a lot more subjective, I think

t's pretty essential for most

[FK1]

It would help if they said whether their accountant actually knew what kind of travelling they were doing.
I've had to point out to my own in the past why my T&S costs have gone up or down.

I had not a problem with my T&S costs for years with the well-known accountancy until the dedicated accountant was changed. It were at least 4 consequent companies accounts submitted where I bought food from Pret @ Manger, Starbucks etc and was happy with the experienced accountant.
A new one used to reclassify all my meal expenses as "coffee expenses" and put it as a director loan. The first year with the new accountant I did not bother as it was £800, but the next year with the new accountant it was over £2000 and then I asked why. Only then I was informed about that binned "coffee expenses".
To be fair, that accountant left soon and I got another new dedicated accountant with whom I was happy. But the feelings remained and I left them on the first occasion.

Well, I was told this by an Inland Revenue member of staff but it could of course have been their own take on it.

I believe claiming or not T&S costs is just one of many factors if you are already
under the investigation. But could not put you under the radar as you could work remotely or locally and nobody knows travel you or not.

But I also accept that claiming your £20/day latte habit as a business expense - just because you're travelling on business - is probably taking the piss. All it needs is a bit of common sense applied.

It might be just some food bought from a coffee shop. For example I bought porridge boxes, cereal bars to consume during a week being on site hundreds miles from home and living in a hotel.
The common sense I used how much could I spent on my food. It was around£15 per onsite day and it should not matter how a shop was called "Tesco" or "Starbucks".

Maybe buy less coffee.

I did not drink it, I ate it

[biergarten]

I've started a few months ago my first contract away from home, and since then having lunch in one of the pubs near the client. I pay around £15-20 with my business card (normally two courses and a drink). Thought it was OK, but after reading this thread, and talking to an accountant this morning it looks like i have to be worried. He even mentioned that "HMRC allows you to claim a lunch expense within reason, ie a sandwich and a drink for maybe a maximum of £5".

what a misery they are promoting! people in front of their computers with the bag of crisps, sandwich and coke,..

[TheCyclingProgrammer]

I've started a few months ago my first contract away from home, and since then having lunch in one of the pubs near the client. I pay around £15-20 with my business card (normally two courses and a drink). Thought it was OK, but after reading this thread, and talking to an accountant this morning it looks like i have to be worried. He even mentioned that "HMRC allows you to claim a lunch expense within reason, ie a sandwich and a drink for maybe a maximum of £5".

what a misery they are promoting! people in front of their computers with the bag of crisps, sandwich and coke,..

If you'd read this thread you'd realise you have no reason to worry.

If you're working on site and still treating that site as a temporary workplace and claiming your travel, then any subsistence including lunch is allowable.

You're not claiming scale rates (which is what your accountant seems to be referring to), you're claiming what you paid. There's no arbitrary cap on what you can spend and not buying the cheapest thing does not make it any less tax deductible (for example, choosing to travel business class is fine, even though you could get a cheaper ticket).

The only exception is if if you're expenses could be considered "unduly lavish" which is at the tax man's discretion but common sense tells you this rule is there to stop you dining out at the Ritz each day, not claiming your pub lunch.

Just remember if it ever stops being a temporary workplace (24 month rule) and you have to stop claiming travel then you also need to stop claiming subsistence.