Training costs to become a driving instructor

Training costs to become a driving instructor

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Hello,

Recently acquired a client who is in their first year of self employment as a provisional driving instructor.

The client is adamant that the costs incurred in training to become an instructor is tax allowable. As far as I am aware, any costs incurred to put an individual in a position to earn a profit is not tax deductible.

I suppose that there is an argument that such training costs, puts the instructor in a position to earn an enduring profit, which would make it capital in nature. I am therefore thinking of bringing into the accounts, amortising the costs but disallowing in the tax comps.

Client’s persistent insistence is making me unsure so just wanted to check out my understanding with others, appreciate any help.

Thank you.

Alan.

Alan Fisher

Replies (4)

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By Robert Hurn
26th Apr 2007 20:02

Agree
I have happened accross this in the past with a driving instructor and it is deemed to be individual putting themself in a position to do business and is not tax deductible. In the case I am refering to an enquiry was launched by HMRC as they beleived the client had claimed the training cost (fortunately he hadn't) but in discussions with the inspector he was adament that had they been claimed he would have disallowed them for the very reason that you state.

I hope this is of help

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By stephenkendrew
26th Apr 2007 20:14

you are correct
You are correct in your analysis.

It would, however, be allowable if he was operating as a limited company!

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By User deleted
26th Apr 2007 20:58

Thank you Robert and Stephen, shall stick to my guns, the last thing I want is to be dragged by this client through an enquiry over this.

Interesting point on the deductibility of the training cost under a limited company structure. Wonder though if the cost shall be viewed by HMRC as the furtherance of the individual’s qualification and trigger a benefit in kind charge? However I suppose it may be rebutted with the expense being wholly, exclusively and necessarily incurred in the course of employment and classed as job related training. Sorry just thinking out aloud.

Thanks again.

Alan.

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By thehaggis
29th Apr 2007 02:08

s250 ITEPA
Allows the cost of work related training for employees, but only where the costs are met by the employer.

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