Education expenses - MBA

[LisaContractorUmbrella]

I think that if the course has already been underway for 2 years and was started before the Limited Company was set up you'd be really hard pushed to prove 'wholly exclusively' IMHO

[SueEllen]

This question has been asked a few times - and the strong consensus is that it is a no. The argument is that you gain from it personally rather than the company as an entity.

That said - I think the rules are different for larger companies - in that they can part sponsor course fees. Not sure how the determination is different, but apparently it is.

Larger companies have more roles where an employee having an MBA can be useful i.e. they will have a finance department or a business development department. Plus there are actually times when larger companies absorb the costs of courses as a way to keep employees and lose out taxwise. One of the reasons why they make employees sign agreements so they don't leave until a set period after completing the course.

In the case of the 3 MBA units that ddolheguy has left if he can argue that an individual unit expands or updates his existing skills in the area and is relevant to the services he is providing his clients then if he asks his accountant they may say yes. However it needs to be done on a per unit basis so while he may get a unit or even 2 through the books he won't be able to get all of them.

I've managed to get non-IT related OU modules paid for by my company due to the clients I had at the time I signed up for the course, my previous skills in the subject area and a client I later had after doing the course. However if I wanted to get a degree in the subject (which I don't) I would have to pay for half of it myself as half the compulsory modules aren't relevant to the subject area so would fail "'wholly, exclusively, and necessarily" test.

[centurian]

This question has been asked a few times - and the strong consensus is that it is a no. The argument is that you gain from it personally rather than the company as an entity.

That said - I think the rules are different for larger companies - in that they can part sponsor course fees. Not sure how the determination is different, but apparently it is.

[Greg@CapitalCity]

Its not easy

The rules around training are very strict - as a bare minimum get the training booked in the name of the company, and paid for out of the company bank account. If you don't meet these two tests, then forget it.

If you do meet them, consider how much the company will benefit from this training. If the tax office could try to pin the benefit of the training as falling directly on you, it will fail the 'wholly, exclusively, and necessarily' test, the course will get taxed to you as if paid as a benefit.

[ddolheguy]

Hi all,

I recently started contracting in my new limited company and next month I'm got my Masters of Business (MBA) course fees due (around £4,000) which I'd like to claim as an expense.

I've been doing the MBA for 2 years (part-time) now and only have 3 units left, but when you're paying £2k per unit it's nice to be able to claim it back.

Does anyone know if this is allowed or if there are any issues with HMRC I should know about?