My client is sole director of her limited company. She travelled to Switzerland on business in January. Her expenses for the month include a cost for ironing charged by the hotel. Normally, I'd have said that this was not an allowable expense and should be covered by the overnight incidental expenses allowance that she can claim from her company - but she has said that the hotel has a policy of not lending irons to customers in case of fire (apparently this is standard in Switzerland). Therefore she had no choice but to pay for an ironing service if she was to look presentable for her business meeting. Would others agree that the ironing cost would be an allowable expense for the company in this case?
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If not covered by the incidental overnight allowance I would go for no.
Mallalieu V Drummond (although the point was on the clothes themselves) covers the point of duality and that the expense is not 'wholly' incurred by reason of the employment. What lady would want to be seen out and about in crumpled clothes anywhere, anytime?
Convincing the client is another matter. I well remember a builder client who insisted that he couldn't do his job unless he had a full English breakfast and swore he would never have one at the weekend or on his days off. Thus it must be tax deductible.
And I have one who always responds
"what should I do, go to work naked?"
A sight I do not wish to behold!
My response to that question (re: Clothing) was:
"I appreciate you need a suit for work, and so you think it is an allowable expense, but it's not I'm afraid. If it was, don't you think I'd be slamming in a claim too?"
Bizarelly, when the client learnt I wasn't claiming my suit, he backed down.
I was thinking about that case only the other day. Didn't the judge say that she needed the clothes in order to be 'warm and decent' and that was the duality of purpose. But why didn't she claim that she could wear a T-shirt and petticoat under her barristers clothes which would cover the 'warm and decent' problem and that her barristers clothes should have been allowed as that was what she was required to wear.
Mallalieu v Drummond might have been decided very differently had she been a man. It is certainly bad law, and an awkward precedent.
Also to clarify the question should probably be whether the claim gives rise to a taxable benefit or not.
It is in any case deductible for CT.
How much is it (a) on each occasion, and (b) across the whole tax year.
The expense is allowable for the company; the question is whether or not there is a benefit for the director, and the correct answer to that is, not if it is trivial.
Look at the rules for trivial benefits- no more than £50 each and overall limit per year of £300 .