For the record...it's not just about great bookkeeping

Was just catching up on some recent tax cases and come across this one;

Tim Healy v The Commissioners for Her Majesty’s Revenue & Customs, [2012] UKFTT 246 (TC), 15 March 2012

The case centered around whether or not expenses were allowed to be claimed on accommodation (not a hotel), travel and subsistence for someone, self employed, working away from home.

The hotel claim was allowed for reasons that can be read if somebody so wishes. The subsistence claim was deemed disallowable, which again seems fairly reasonable (the place had cooking facilities).

It was the travel claim that intrigued me most. Mostly because whilst reading the article/summary I came to the conclusion that it would be classed allowable due to the nature of the work.

A self-employed actor, finishing late at night who wished to take a taxi back to their accommodation at unsociable hours. Despite no receipts being kept, a reasonable distance calculation was made between the accommodation and place of work for the nights that were worked.

The travel was deemed disallowable. Not necessarily because the receipts were missing (although this may have played a part). The conclusion was due to the fact that the trips may not have been "wholly and exclusively" for the purpose of trade. Investigation of bank statements discovered that cash withdrawals or card purchases were made at clubs and pubs after a performance.

So yes, keeping taxi receipts is important and will certainly add weight behind an expense claim. However, also keep a record of the journey, where did you go? What time? Who did you see? I have no doubt that some the journey were not "wholly and exclusively" for the purpose of the trade as the card purchases revealed. Equally, I am also pretty sure that some were due to unsociable hours straight from a performance; but the whole claim was disallowed.

It’s not just about keeping accurate books... but also accurate records.

 

 

 

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