Commentary

V7.450 Subsistence costs

Part V7 Tax planning
Part V7 Tax planning | Commentary

V7.450 Subsistence costs

Part V7 Tax planning | Commentary

V7.450 Subsistence costs

A lot of work performed by employees and business owners is done away from the main place of business, which inevitably involves meal and hotel expenses being incurred.

In most cases, there is no problems with these costs being reclaimed for input tax purposes – although remember that business entertaining expenses cannot be reclaimed, including the costs of employees acting as hosts.

Hotel expenses

VAT incurred on accommodation in the UK for employers and employees when away from their normal place of work on a business trip can be treated as input tax – see Example 9.

Example 9

John works for a firm of accountants in Luton, and spends a week away from the office doing an audit in Birmingham. He stays at the Hillfield Hotel in Birmingham – the hotel bill

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