Hear at the Institute for White Goods Engineers we know hard it is for an independent appliance repair engineers to survive so we are constantly on the look out for useful information for our industry.
Hear is a useful guide we received from our accountants.
As a limited company or director, managing expenses is a crucial aspect of optimising your finances. Knowing which expenses you can claim through the company can significantly impact your tax liability and overall financial health. In this article, we’ll explore the most common allowable business expenses for limited companies and directors, helping you make informed decisions about your financial matters. Plus, we’ll provide a recommendation for Morethan Accountants Ltd to assist you in navigating these expenses efficiently.
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Items that can be claimed for
- Health Check and Eye Test Expenses:
Employees who extensively use computer screens as part of their job can claim eye tests and health checks as limited company expenses. The cost of prescription glasses or contact lenses is also claimable if strictly used for screen-based work.
- Business Insurance Expenses
Business insurance policies, such as public liability, employer’s liability, professional indemnity insurance, and contents insurance, can all be claimed as limited company expenses if solely used for business purposes.
- Advertising, Marketing, and PR Expenses
Expenses related to advertising, marketing, and PR activities can be claimed as limited company expenses, provided they are used exclusively for business purposes.
- Material Purchases
Materials or goods purchased for business purposes are allowable expenses for corporation tax purposes.
- Accommodation Expenses
If you need to stay overnight away from home for a business trip, you can claim the accommodation costs as expenses. The costs of food and drink during the trip can also be claimed as travel and subsistence expenses.
- Bank Charges
Bank fees charged to your business accounts, including credit card and loan interest, can be claimed as business expenses.
- Use of Home as Office
If your home serves as the heart of your business, you can claim a percentage of household costs and utility bills as business expenses. This includes lighting, heating, postage, printing costs, and accountancy and legal services if they are solely used for business purposes.
- Gifts, Entertainment, and Trivial Benefits
Certain gifts and benefits for employees may be exempt from tax and National Insurance. Morthan Accountants Ltd can provide guidance on these exemptions and ensure compliance with HMRC rules.
- Professional Subscription Expenses
Occupation-specific magazine subscriptions, journals, and books can be claimed as limited company expenses, aiding in keeping up-to-date with industry trends and competition.
- Phone Bills
Work phone contracts and broadband payments can be claimed as limited company expenses. If the contract is personal, only business-related expenses can be claimed.
- Annual Staff Party Expenses
The costs of entertaining employees during an annual event, such as a Christmas party or summer gathering, can be claimed as a business expense if certain criteria are met.
- Equipment Expenses
Equipment necessary for your role as a limited company director, including computers, software, scanners, printers, and office furniture, can be claimed as company expenses if predominantly used for business purposes.
- Stationery & Postage
The cost of stationery, postage, faxing, printing, and photocopying is an allowable business expense if necessarily incurred in the performance of your duties.
- Professional Development Expenses
Training courses and personal development relevant to your occupation can be claimed as limited company expenses.
- Travel Expenses
Travel expenses can be claimed if they are necessary for work purposes and involve being present at the destination for business reasons. This includes various travel modes and associated costs like parking, road toll fees, and public transport fares.
- Start-up Costs
Pre-formation business expenses incurred up to seven years before a company starts trading, such as laptops, software, internet and domain name fees, travel, accounting, and legal services, can be claimed as limited company expenses.
Directors who pay themselves a salary as employees of the business can claim this, along with corresponding National Insurance Contributions, as allowable expenses.
Contributions to your pension pot through your limited company can receive 100% tax relief, up to the £40,000 annual limit.
- Relevant Life Insurance
Relevant life insurance is an allowable expense for Corporation Tax purposes without incurring a benefit-in-kind.
- Entertainment Expenses
While business entertainment expenses are generally not allowable against profits, Morthan Accountants Ltd can advise on specific cases where exceptions may apply.
In Conclusion: Choose Morthan Accountants Ltd for Expert Expense Guidance
Navigating allowable expenses for a limited company and its directors can be a complex process. With the inexhaustible list of potential deductions, seeking professional guidance is essential to optimise your finances and ensure compliance with tax regulations. Morthan Accountants Ltd offers comprehensive expertise in managing expenses, helping you claim the right deductions while adhering to HMRC guidelines. Contact them today quoting THEIWGELTD for personalised assistance in streamlining your financial affairs and maximising your company’s potential.
Disclaimer: We aren’t accountants so please check the above information before actioning it.