I've been looking at the rules around the eligibility or not of training as a tax deductible business expense. I can understand that work related training is only eligible as a business expense if it relates to maintaining or improving existing skills, not for entirely new skills.
I'm considering subscribing to Codecademy Pro which provides multiple online courses relating to multiple different aspects of coding. Where my current skills are self-taught, this would be about enhancing these and adding to my capability, specifically in the fields of data handling. Would such a subscription therefore be eligible for an IT company to pay for directors/enmployees and claim tax deduction as a valid business expense?
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Do you definitely have a limited company, as opposed to a sole trade business?
The rules differ.
The company can pay for any type training for employees and claim a tax deduction. There is no taxable benefit on the employee as long as it is work related.
There is no taxable benefit on the employee as long as it is work related.
More precisely, there is an exemption from the BIK that would otherwise arise. The exemption has various conditions. "Work related" is a convenient shorthand for the conditions, but one needs to apply the legislative definition of such terms, not one's own.
To augment TD's post the statutory definition of work related is;
251 Meaning of “work-related training”
(1) In this Chapter “work-related training”, in relation to an employee, means a training course or other activity designed to impart, instil, improve or reinforce any knowledge, skills or personal qualities which—
(a) are likely to prove useful to the employee when performing the duties of the employment or a related employment, or
(b) will qualify or better qualify the employee—
(i) to perform those duties, or
(ii) to participate in any charitable or voluntary activities that are available to be performed in association with the employment or a related employment.