Hello? – this is a work call
If you use your phone for work purposes, you can write off a portion of your phone bill.
As with household expenses, your phone sits firmly in the Statistical Approach category. Estimate how much time you spend on your phone for work versus personal.
The Reasonable-ness concept comes into play as well. So don’t overdo it.
What exactly is considered travel?
The question often comes up – when I travel, what can I write off.
Before answering that question, you have to answer the question, What is travel and what is not travel? And what is subsistence?
Let’s start with travel. Or rather, what is not travel, ie. Your place of work.
HMRC says the ‘place at which an employee works is a permanent workplace if he or she attends it regularly for the performance of the duties of the employment. … By contrast, ‘A workplace is a temporary workplace if an employee goes there only to perform a task of limited duration or for a temporary purpose.’
Within this definition, travel is when you work from someplace that is not your permanent workplace.
Do you work from home and sometimes go into an office? Or do you work from an office and sometimes work from home? There is a huge difference in those two seemingly similar statements. The first, you write off travel and subsistence to and from an office and the second, you don’t. In both cases, you can write off the cost of your home office.
Confusing, I know. This is why we’re here and why having an accountant is important.
Subsistence expenses are costs like: business travel, meals, hotels, sundry items such as laundry (though usually only on long trips) and similar ad hoc expenditures.
All of this means that when you ‘travel for work’ – ie. Work someplace that is not your permanent workplace, you can claim expenses for almost everything you do. Travel (train, car, tube, plane, etc.), meals, overnight stay, the cost of your mid-day coffee are all business expenses when you are away from your permanent workplace.
“I’ll get this one, you get the next one.” Entertainment
You may want to re-think the next time you use that phrase. From a tax perspective, it is MUCH better to split the bill.
As mentioned above, you can claim subsistence as a business expense. This is the cost of your own meal. If you are at a business lunch, no problem, the cost of your meal is okay to expense.
However, if you pick up the tab for your client, it is not a tax deductible expense.
In our example above, if you split the bill twice, you can write it off both times. If you get one and your client gets the other, both of you are down one meal from a tax standpoint.
Like a good first date, split the bill.
Industry Specific Expenses – Do your research!
The tax deductions are in the details!
Many industries have governing bodies, unions or associations. These associations are ripe with industry specific information and how it pertains to you. Taxes are often a pain point and one that is covered in detail.
If you can’t find your governing body, a lot of accountants will give a 15 minute ‘free’ session to talk you through what you can write off and what you can’t. Note: in January, this may not happen as Accountants tend to be too busy.
What other questions do you have?
We are always looking for topics to write on. What else do you want to know? Message us on our site or e-mail at firstname.lastname@example.org and let us know.
CEO | Finmo
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