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Overseas Audition Costs for a Musician

A deductible expense?

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A classical musician client working in the UK attended an audition for a full-time post with an orchestra in the USA. She has claimed the travel and hotel costs as expenses in her self-employed records.

Normally audition costs are claimable as an expense but in this case obtaining the post would bring an end to the UK trade as she would have to relocate to the US.

I am thinking I should disallow the costs as not being "wholly and exclusively for the purposes of the trade" but perhaps my interpretation is too narrow? The "trade" will continue just not in the UK, so perhaps we could allow the costs?

 

Replies (9)

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By WhichTyler
22nd Nov 2019 13:04

I think your definition of the trade of a musician being restricted to UK income only is too narrow....

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By maxaca
22nd Nov 2019 13:59

She might not get the post, and even if she is successful and relocates, that doesn't automatically bring her UK activities to a halt.

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By whitevanman
22nd Nov 2019 14:12

Not sure I would agree the first 2 replies (depends on facts).
The OP refers to a "full time post" in the US.
Such posts are often salaried and therefore nothing to do with the self employment whether or not it continues.

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By sijolees
22nd Nov 2019 14:28

Thank you for the replies. If the audition was for one of the orchestras in the UK where PAYE is in operation I would agree that the audition costs would not be deductible.
Obviously I don't know that much about arrangements in the US but I think this is a self-governing orchestra so self-employment will continue - but the UK self-employment will definitely cease.

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By Accountant A
22nd Nov 2019 14:34

Surely the trip was unnecessary. She could have just played down the phone.

Did she take the opportunity to have a holiday while she was over there?

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Replying to Accountant A:
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By sijolees
22nd Nov 2019 15:21

She stayed with her in-laws in the US. She only claimed, however, for travel from the in-laws to the orchestra and the hotel cost of staying in that city. The cost of getting to and from the US has not been claimed.

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By The Dullard
22nd Nov 2019 14:56

Isn't there a case somewhere about a farmer that relocated to Australia?

It doesn't bring an end to the trade, if she continues to be self-employed, it's just that there's a deemed cessation and recommencement. I don't see how the deeming provision makes the expense otherwise than for the purposes of the trade.

Obviously, as is noted, duality needs to be considered.

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Replying to The Dullard:
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By sijolees
22nd Nov 2019 15:23

The sheep farmer rings a bell - I will try and track that down, thank you.

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By carnmores
22nd Nov 2019 18:59

depends on what you mean by full time are you sure all s/e income will dry up are there any residual royalties etc?

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