Expenses When Staying Away from Home

[Old Greg]

Totally different I'd say - self employed and discussing meals away from a qualifying journey. He wasn't entitled to claim any sustenance, but attempted to wrap it up as required for the role.



Sure, but you'll find lots of "It's a grey area" or throwaway statements with very little true substance. It might well be the safest place to sit, but I pushed both SJD and Gorilla for further guidance and they couldn't really provide any. We know that a meal prepared at home is dis-allowable, BUT you can outright choose to pick up a sandwich on the way to work instead and that is - that's all in black and white in their guidance.

It is indeed an area that HMRC haven't provided much guidance on, I'll grant you.

And, I'm sure like most people, there are plenty of myths and "Because that's what I was taught" in your industry - I don't think accountancy is that much different.

I suppose the problem is that there's a "Don't push it" element to all of this, but we all have different limits. Personally, I tend to base it off what I'd put up with being sent away by an employer - and, just because they've found an apartment instead of a hotel doesn't mean I'm going to start putting my hand in my pocket to buy food to cook. Obviously that's a long way from legal advice, just giving some insight on my thought process.

It is good to push the discussion on. I remember one about the 24 month rule where I ultimately went against the guidance of my accountant (my temporary base moved from one end of London to the other and I had a completely different journey with a cost difference).

But it seems odd to say that you wouldn't put your hand in your pocket to buy food to cook when that is exactly what you would be doing when at home. It seems like you feel out of pocket in relation to getting your restaurant meal paid, when in fact you restaurant meal claim was just to make sure you weren't out of pocket in relation to buying food to cook at home.

[vwdan]

It is good to push the discussion on. I remember one about the 24 month rule where I ultimately went against the guidance of my accountant (my temporary base moved from one end of London to the other and I had a completely different journey with a cost difference).

I think an accountant, especially over e-mail, would be foolish to give advice which could come back to them - so I always view their advice through that context. It's the advice they're happy to back up in court, essentially - everything else is "on you". Like anything, review their guidance and make your own decisions ultimately.

But it seems odd to say that you wouldn't put your hand in your pocket to buy food to cook when that is exactly what you would be doing when at home. It seems like you feel out of pocket in relation to getting your restaurant meal paid, when in fact you restaurant meal claim was just to make sure you weren't out of pocket in relation to buying food to cook at home.

Technically, I suppose you could argue that the whole concept is indeed to cover additional costs incurred. But the reality accepted by both legislation and HMRC's guidance is that there is basically no way to compare the two. If I buy a sandwich every day at my normal place of work, that doesn't prevent me from buying and claiming back the very same sandwich when sent to another office on a qualifying journey. Likewise, if I have a curry every Thursday night - does that mean I can't claim for my curry when away from home? In some ways, you could argue it should - but, like I say, that's not the accepted reality. The qualification of the journey seems to be the most important factor and beyond that there's very little specific guidance on *what* counts as sustenance. To me that implies they don't particularly care, so long as it's purchased and consumed within the qualifying portions of the journey.

I will confess that I definitely see these expenses as a small mitigation to being sent away. Again, I realise that's not what they're for legally

[northernladuk]

Everyone says it, so it must be true. Right.

As opposed to everyone is saying it, so it must be wrong? Right. No wrong.. No. Erm .You know what I mean.

[northernladuk]

Technically, I suppose you could argue that the whole concept is indeed to cover additional costs incurred. But the reality accepted by both legislation and HMRC's guidance is that there is basically no way to compare the two. If I buy a sandwich every day at my normal place of work, that doesn't prevent me from buying and claiming back the very same sandwich when sent to another office on a qualifying journey. Likewise, if I have a curry every Thursday night - does that mean I can't claim for my curry when away from home? In some ways, you could argue it should - but, like I say, that's not the accepted reality. The qualification of the journey seems to be the most important factor and beyond that there's very little specific guidance on *what* counts as sustenance. To me that implies they don't particularly care, so long as it's purchased and consumed within the qualifying portions of the journey.

I will confess that I definitely see these expenses as a small mitigation to being sent away. Again, I realise that's not what they're for legally

But you need to look at the exact situation. This is about cooking in a kitchen. Period. No sandwiches, coffee etc. So... If you buy 4 quids worth of food and cook it at home, it's directly comparable to buying 4 quids worth of food and cook it away. The fact you are away on business makes absolutely no difference so it can't be used as a tax relief for money being spent on business. If you have to spend £15 on a takeaway or meal because you are away then it's costing more hence the tax relief to help. It's too hard to justify how much it is over normal so you just claim the whole £15. It's a common sense decision.

Situation one is eating to live, situation two is incurring costs doing business. It's pretty black and white IMO.

If you start talking about sandwiches and coffees etc you've got to look at that instance in detail. It is a very grey area I agree but look at each in detail it becomes a little bit clearer. Remember why the tax relief is being applied also helps.

[vwdan]

But you need to look at the exact situation. This is about cooking in a kitchen. Period. No sandwiches, coffee etc. So... If you buy 4 quids worth of food and cook it at home, it's directly comparable to buying 4 quids worth of food and cook it away.

So? This is what annoys me - you're making a distinction that simply doesn't exist anywhere else. I know precisely what you mean, but it's not backed up in the legislation. We can't look at it in isolation, simply because no specific rules exist so we have to take our cues from the other stuff. Going for a curry at home is identical to going for a curry at work - and yet that is clearly allowable.

The fact you are away on business makes absolutely no difference so it can't be used as a tax relief for money being spent on business.

Couldn't disagree more. That fact you're away on business makes ALL the difference - it is THE difference. Look at all the examples and guidance and nearly everything is focussing on what counts as a journey - barely anything covers the "what", purely the "when".

If you have to spend £15 on a takeaway or meal because you are away then it's costing more hence the tax relief to help. It's too hard to justify how much it is over normal so you just claim the whole £15. It's a common sense decision.

Again, not at all. Remember, for a start, that the tax relief side is only a win to us Ltd Co directors. For normal employees, it's completely claimable and doesn't cost them a penny - by this logic they should only be claiming the portion that costs them more. Again, you're seeing differences that simply don't exist in the law.

Situation one is eating to live, situation two is incurring costs doing business. It's pretty black and white.

Disagree.

[northernladuk]

So? This is what annoys me - you're making a distinction that simply doesn't exist anywhere else. I know precisely what you mean, but it's not backed up in the legislation. We can't look at it in isolation, simply because no specific rules exist so we have to take our cues from the other stuff. Going for a curry at home is identical to going for a curry at work - and yet that is clearly allowable.

It could be that they don't need to make the distinction between your £4 cooked meal at home and your £4 in a kitchen somewhere else. That's irrelevant. They are only focusing on extra costs incurred from being away. But yes, a quick paragraph to clarify wouldn't do any harm at all.

Again, not at all. Remember, for a start, that the tax relief side is only a win to us Ltd Co directors. For normal employees, it's completely claimable and doesn't cost them a penny - by this logic they should only be claiming the portion that costs them more. Again, you're seeing differences that simply don't exist in the law.

It's claimable from their employer. That's completely different to what's claimable for tax.

Disagree.

And that's where we will have to leave it.

[vwdan]

It could be that they don't need to make the distinction between your £4 cooked meal at home and your £4 in a kitchen somewhere else. That's irrelevant. They are only focusing on extra costs incurred from being away. But yes, a quick paragraph to clarify wouldn't do any harm at all.

Take a look - I'm not making this stuff up. Chapter 2: https://www.legislation.gov.uk/ukpga...0030001_en.pdf Essentially nothing on what constitutes subsistence.

It's claimable from their employer. That's completely different to what's claimable for tax.

Not quite with you here. For the most part, if you can claim it back as an employee without incurring tax then it's going to be tax deductible for your company. For food and travel they're basically one in the same.

And that's where we will have to leave it.

Fair, but let it be noted for the record that you've not been able to find any guidance or legislation whatsoever to back your position

[northernladuk]

Fair, but let it be noted for the record that you've not been able to find any guidance or legislation whatsoever to back your position

Right on boyo. I'm sure nothing the same existed for the EBT guys at the time either.

I've lost track of what we are trying to prove in an effort to prove my willy is bigger. There are many articles advising using terms such as reasonable, and extra costs. Many more advising you don't claim for food you cook. Common sense kicks in when what you buy at home is the same as you buy away. Next to nothing saying go ahead and claim it. But you are right. Nothing in legislation or official guidance.

So what does this mean? If you were to get challenged it's likely the greater consensus would prevail and it's likely you'd come out worst. Would you get challenged? It appears not as no one's been done for it so claim it.

If your stance is you'll claim it until you've got proof you can't then fill yer boots. I'll take a balanced view based on so many articles and my own thinking on what should be allowed and happily discuss it until the cows come home.

How's that?

[Glencky]

Just out of interest, and to add a further dimension to this...

Personally, I like to cook. A lot. So when I'm working long hours and staying away, my meals look like this:

a) a proportion of the time, I'm at home. I prefer to eat healthy, well-made, home-cooked food, so I batch cook on weekends and whenever I have time. I make home-made 'ready meals' and end up eating them late at night before commuting back again the next morning

and

b) a proportion of the time, I stay away in hotels. Sometimes I'll have no cooking facilities - in which case, restaurant or takeaway and all claimable. Sometimes I'll have some kind of (maybe limited) cooking facilities. In which case, I'll make an effort to buy something healthier and more resembling of 'real food' than I'm likely to get from a restaurant or takeaway. It'll be cheaper than a restaurant, but it'll be considerably more expensive than the cost of my proper home-cooked food (because you end up buying just for one or two meals, and wasting more food than you would at home, or buying over-inflated M&S food because at least it is half way decent with a few vitamins in it).

I've always claimed the cost of food away as subsistence whether it's restaurant food or made-in-accommodation food. For me, it's the same reasoning - the reason I'm eating less-good food for over inflated prices is solely because I'm away for work.

Admittedly a lot of what I'm referring to took place before the T&S changes linked to IR35, when I was still claiming T&S despite operating inside IR35. But I think that's irrelevant here. I still operate inside IR35 and I don't claim any of this any more for travel to what is now deemed my 'usual place of work', but if travelling to another office where it is claimable still, I'd do exactly the same for the same reasons.

On the subject of accountants, I agree that some accountants don't put any thought to this but go on a parroted rules-based approach. when I started contracting in 2014 I was working in Asia on a 'mates rates' contract that I did for the experience, so any tax relief was very welcome to me. I read the entire expenses manual at the time and loads of pages of the HMRC detailed guidance (which is so hard to get at now they've updated the website and migrated it all to .gov.uk) I read all the standard stuff and a lot of the 'whilst abroad' stuff obviously, and I was very satisfied I could claim various things my accoujntants wouldn't have considered. For example, I was buying huge amounts of DEET and sunscreen which simply would not have been needed had I been working in the UK - all got charged to the company with tax relief.

As the OP says, I often think 'would I reasonably have tried to claim this if I was still working as a permie' (when the company had a very ungenerous expenses policy, I might add, so this is a good rule of thumb). If I think the answer is yes then I look for guidance, think about what is reasonable and then make my own call.

Each to their own (at least where no specific HMRC guidance to the contrary exists and where the decision is in line with the principles established...)

[Maslins]

I suppose the problem is that there's a "Don't push it" element to all of this, but we all have different limits. Personally, I tend to base it off what I'd put up with being sent away by an employer - and, just because they've found an apartment instead of a hotel doesn't mean I'm going to start putting my hand in my pocket to buy food to cook. Obviously that's a long way from legal advice, just giving some insight on my thought process.

I think you're right here. If someone's going to a Michelin starred restaurant for breakfast, lunch and dinner consistently, then the total food costs in the accounts are going to be huge. It's likely to attract attention from HMRC.

Remember initially at least HMRC are only going to see the headline figures. Ie without enquiring, they won't be able to distinguish between someone who spends £2k/year on £10/day of 3 separate very modest meals, and someone who spends £2k/year on a small handful of extravagant meals but then nothing 99% of the time. So whilst an accountant might query the latter, they'd feel more comfortable with it than a client claiming £20k/year on lots of extravagant meals.

HMRC might not officially admit it, but I'm sure it's the case that they have certain red flags. Ie they know your business broadly does X, and based on the thousands of other businesses doing X, they'll have an idea of what numbers to expect, at least proportionally. If yours stick out significantly from that norm, it's more likely questions will be asked.

At the end of the day accountants want clients to be happy without peeing HMRC off. If HMRC get miffed, it'll mean extra work for the accountant and client in providing receipts, explanations etc. Hence the "don't push it" factor. Yes if the costs are legally valid then at the end of the day HMRC can huff and puff but won't win...however, you then need to be careful you don't slip up on anything else, have all your evidence perfectly in place etc. Ie it's a bit of a dangerous game IMHO.

My days of wading through the actual legislation are behind me...I earned my stripes ~10 years ago to do my CTA, found it completely unintelligible on the most part, and don't intend to restart now. However I believe there is a comment about "reasonable" subsistence. I think HMRC are deliberately vague here. Whilst some lefties might consider this unfair, many would agree it would be unreasonable to expect Richard Branson to get a supermarket meal deal, but similarly it would be unreasonable for a labourer to have a 3 course lunch with posh wine.

So in short (in a bland, sitting on the fence kinda way)...I sort of agree with you, but similarly I agree with others who play it a bit more safe than perhaps you do.