If researching for a pub and restaurant guide, are food/drink/travel expenses allowable for tax?
Still worth a punt though?
DECLARATION - I am NOT a tax expert!
I would guess that Mr Winner would eat at the type of restaurants reviewed in his column as a matter of course. However an 'ordinary' person would not, nor would they stay in hotels night after night.
SO: - As long as the activity was in connection with an established guide OR there was a publishing deal in place which was likely to yield considerably more than the expenses, I can't see the problem. If, however, the guide were, for instance, self published by an individual a cynic may feel that this was an attempt to defray the costs of a jolly at the taxpayers' expense. Would it help, I wonder, if the critic were employed by a Ltd Co.?
p.s. It would pre-empt the precedent if an amount were deducted in respect of the food and drink that would normally be consumed.
Duality of purpose
If the client were to have a meal at home in addition to the meal at the pub/restaurant this would eliminate the dual purpose argument. Of course it would probably have to be a very small salad or his/her next guide would have to be a weight-loss guide!
Thanks. Was Winner's case Sch D or E (perhaps under a company)? What about claiming back the VAT? What about if the guide is going to be self-published, and it may take some time to complete the research and publish? Is mere intention enough? etc
I think I am going to write a book on dive sites aroun the world sometime in the future which I might self-publish, can I claim my travel costs?
Thanks. As a partner in a professional firm which is VAT registered, remind me:
(1) Is each partner already bound to charge appropriate VAT on any eligible supply he/she may make outisde that business, however small?
(2) Can any VAT deemed claimable be claimed through the firm's VAT return?
A partnership is a seperate VAT entity from the individual partners and indeed from any other partnership they may be in. (NOTE: But if the membership of two partnership is identical the HMRC may try the artifical division of trade argument).
A partnership (or indeed any VAT registered entity) may only recover input VAT relevant to its trade.
Which reminds me ...
Thanks @ChrisSmail. That avoids another problem! If you happen to know the requisite Act or HMRC guidance webpage (which I've searched for without success) I'd be keen to hear.
The "artificial division of trade" reminds me of a situation a friend is in trying to grow his B2C business just beyond the VAT threshold. Like many others, his company is facing having to add c20% onto all its prices (given he uses £X95 psychological pricing). In his case that's £100-£300 added on to each of his main products, or c15% lower net revenue. Any totally legitimate suggestions?
Callibotte v Quinn
The above Tax Case had obiter dicta (other things said) by the Judge that "if one had the part in Alice in Wonderland drinking tea at the tea party, that would be allowable". Admittedly the ratio decidendi (reason for the decision) decided against the taxpaer, who was a self employed carpenter who sought (back in the early 1970s) to obtain about £1 a week deduction for his mid-day egg and bacon meal. He lost because of "duality of pupose".
I would have thought that this was worth a punt
The GoodEnglish Professor