Springfords LLP blog

Some news, views and comments about everything and anything, relevant and irreverent.

Allowable expenses that just aren't

21 February 2017

When is a guard dog not a guard dog? When it’s about six inches long and lives in your handbag - that’s when. So, if you really feel the necessity to claim your Hermes clutch as a business expensed kennel for your intruder repelling Shih Tzu, you better be prepared for a bit of a yelp from HMRC.

It’s been a long running argument with HMRC. Their predecessors at the Revenue argued it, and their predecessors before that also argued the toss over expenses. Go right back to biblical times, and there has always been a bit of a furore about what’s hot and what’s not when it comes to expenses.

Now, as you know, taxation is a bit of a religion for us at Springfords. We may not set ourselves up as high priests, but when it comes to making offerings at the altar of accounting, we know our stuff, and we know what stuff is legitimate, and what stuff is ludicrous; especially when it comes to what goes in the expenses claim column. Not surprisingly, HMRC have a pretty good handle on this too.

There have been a number of hapless souls who tried to claim for, among other things: overseas dental work ahead of business meetings; designer jeans as protective wear for a painter; and our own favourite - luxury watches as gifts to staff ... in a return from a company with no staff.

According to national newspaper reports, and a press release from the ministry of money, all these claims were genuine, and all were genuinely rejected, along with a rather close scrutiny of the rest of the tax return too, we don’t doubt.

Now, at Springfords, we tend to ask some awkward questions, before things get as far as presenting your returns to the tax man. You might squirm a bit if we question the voracity of your claim that those international holiday flights and that designer lingerie were purchased without any hint of duality or personal use - to quote two other genuine examples. Imagine though, how much more you’ll squirm under the interrogation of an HMRC inspector.

So, unless you’re a professional voice over artist, scary sound effects equipment isn’t going to be a legitimate expense, nor will macabre makeup costs be allowed, except for full-time zombie performers. If being hammered for horrible expenses sounds like a shocker to you, might we humbly suggest that, before you get stuck in the dog house by HMRC for an implausible claim, you let us take a look at your returns, and if your Hell hound happens to be a sleeping Shih Tzu, we suggest you let it lie, or it’s Hades, not Hermes you’ll be clutching.

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springfords blog

Some news, views and comments about everything and anything, relevant and irreverent.

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