My client is a professional bowman (yachtsman), and has purchased an expensive road bike he considers a business expense - citing his profession requires high fitness levels. My thoughts were that unless a primary form of transportation, tax allowances cannot be claimed due to the duality of purpose - inclusive of the fact that maintaining a level of fitness will be just as much a personal benefit as a business one.
Any help/comments would be much appreciated!
Many thanks,
Replies (4)
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The bike is capital expenditure, so the wholly and exclusively test does not apply.
Capital allowances are available if the bike is used, to any extent, for the purposes of the business, and are restricted to the extent that there is personal use. Benefits do not come into it.
Taking your thought process another step, what do you consider constitutes 'personal use'?
Well, the legislation actually refers to use other than for the purposes of the qualifying activity. And I think that's something where I would have to be instructed by my client, but point out the scope for HMRC to consider the matter highly subjective.