Forum

• # 74821
• Mon 03 Oct 2011 02:35 PM

Hello All,

I've got a question I would like to double check with people.

I've just taken on a new client who has several meetings with prospective clients in coffee shops and she normaly buys her self and the client drinks.  

Her previous accountant use to put these through the books as a business expenss.  My initial though is that this is not an allowable expense, as it is concidered intertaining a client.

Is my thinking correct that this is not an allowable expense?

Thanks
Torben

Edited at 03 Oct 2011 02:35 PM GMT

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• # 74826
• Tue 04 Oct 2011 08:56 AM

Hi Torben,

Yes you are correct this is not an allowable expense as it is considered client entertainment.


Thanks.

Meena  

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• # 74837
• Tue 04 Oct 2011 12:15 PM

That really surpises me as I would have thought it is no different to buying tea/coffee for the office and offering as part of the meeting.

Think I've still got a way to go before I'm completely up to speed on these things!!!!

Denise

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• # 74843
• Tue 04 Oct 2011 02:28 PM

Hi 

I spoke to HM Revenue about this issue in detail.  If is normal for client to hold their meetings at tea shops because of no office space for example  .  They would allow the basic tea and coffee and nothing else ( like a nice Cake )  and this would all most be like hiring a room.  As  you cannot  sit there for free.   They this as  a common sense  approach and it is  obvious if a client is abusing this. 


The HM have said they would use their judgment if  it is more than  tea and coffee you are getting into entertaiment.





Edited at 04 Oct 2011 02:30 PM GMT

• Sarah Douglas C.FICB

  HouseTree Business Ltd 

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• # 74906
• Wed 05 Oct 2011 04:04 PM

Dear All

I know I am going to sound like a broken record on this issue but I am going to say it again.

If you are not sure of an answer then please state it in our reply use words like I believe etc etc.

If you start making your replies sound like fact people will take them so and this leads to issues when you are not quite correct.

Meena please be careful when posting replies things may not always be so black and white.

Please  accept this as friendly adcvice as you are a valuable member of the forum whose contributions are greatly appreciated.

Warmest regards
Stuart 

• Forum Moderator, South East & Greater London Regional Chairman
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• # 74971
• Fri 07 Oct 2011 02:03 PM

Hi Stuart,

Thanks for the advice. I had always taken anything to do with food, tea, coffee etc as client entertainment in the past as I believed it to be not allowable for tax but I had never considered it from that angle before.

You learn something new everyday!

Thanks.

Meena

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• # 75019
• Sun 09 Oct 2011 03:18 PM

Hi Meena

The day we stop learning will be a boring day indeed. (I still find myself learning new tips and tricks).

Some of those new tips and tricks even come from this forum.

Like you I had spent years treating all food and drink with clients as entertainment it was only an update from our tax partner in response to a client query that enlightened me.

Best regards
Stuart

• Forum Moderator, South East & Greater London Regional Chairman
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• # 75122
• Tue 11 Oct 2011 02:27 PM

Thanks every one for your input on this.  

I've now talked to both ICB and the previous accountant and they both came back with the same aregument as Sarah.

As Meena said you learn something new every day.

Thanks
Torben 

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