Could anyone help? We have a dispute on whether or not subcriptions charges to the Federation of Small Business are deductible. I know it is not a material amount however it would solve a long running dispute between the partners in the office. Do they fall into ICTA S201 or not. Can anyone tell me how i can find out for sure. I have already asked FSB but probably not got through to the right person.
Many Thanks
Michelle Ward
Replies (6)
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Wholly & Exclusively?
There are elements to the FSB membership which I believe the Inland Revenue would argue is 'strictly' not allowable; namely the tax and VAT Professional Expenses Insurance (PEI). I met with Inland Revenue Head Office 18 months ago to discuss the allowablity of PEI and they were insistant that the 'pure' answer is that PEI is not allowable, but agreed that in practice the Revenue would not be wanting their Inspectors to be pursuing such 'trivial' matters!
Whilst the PEI is a relatively small element of the FSB membership, I have no doubt that the Revenue could argue that strictly it isn't allowable. Back in the real world, however, I cannot believe that they would take up the point!
Finally, in the near future, I understand that a Tax Bulletin will be issued by the Revenue on this and related issues.
Colin Davison
Abbey Tax Protection Limited
Deductible
Although they do not appear to be deductible under s.201 ICTA1988, I agree with Neville: I can see no reason why a deduction should not be claimed under s.74(1)(a).
Basics
Surely the test of "wholly and exclusively for the purposes of the trade" is the deciding factor. As "necessarily" doesn't come into SchD, relevance to the particular trade is immaterial. Also, there are definiable business benefits to membership that could justify easily it as an expense.
Is there any private use, I think not. So where is the problem ?
I think so
I don't have time to give any statutory support to this, but for what its worth I would have allowed FSB subs without further thought.