A Guide to Business Expenses

Overview

In this business expenses guide, we explain the rules on tax when it comes to certain company expenses. Companies pay tax on the profits the business makes. So, you pay less tax if costs can be set against profit.

For day to day overheads, those costs generally have to be incurred ‘wholly and exclusively’ for the purposes of the trade, in order to be tax-deductible. Because expenses are a fantastically complicated area of accountancy, this guide is here to simplify them for you.

A guide to business expenses - what’s included

• An overview of the categories in which you can claim business expenses
• Why it’s essential to keep good records
• Examples of the ‘wholly and exclusively’ rule in practice, including phones, cars and travel
• The difference between subsistence and entertaining when it comes to claiming expenses
• Examples of circumstances which show the difference between subsistence and entertaining
• Why the majority of entertaining costs are not allowable expenses
• The rules around company parties and gifting