VAT input and TAX on business suit / wear and lunches

mamutka

Hi,

I am wondering is it ok to claim VAT input on business wear and shoes (where the sole trader must wear a suit / formal clothing)?
Also, can I set it off against profit for the tax purposes?

The same question about lunches. The person spends all days on the customer's premises in order to do the job and once a day buys a lunch for himself. Can I claim VAT on this back and can I set it off against tax?

Any advice appreciated, thanks.

CIARAN_BOYLE

mamutka wrote: »

Hi,

I am wondering is it ok to claim VAT input on business wear and shoes (where the sole trader must wear a suit / formal clothing)?
Also, can I set it off against profit for the tax purposes?

The same question about lunches. The person spends all days on the customer's premises in order to do the job and once a day buys a lunch for himself. Can I claim VAT on this back and can I set it off against tax?

Any advice appreciated, thanks.

No and no
http://www.revenue.ie/en/business/running/allowable-expenses.html

Marcusm

The problem is "duality of purpose" (ie clothing you AND presenting you I a business appropriate manner). This means the clothes are not "wholly and exclusively" used for business purposes.

Mr. Incognito

A barrister lost a case trying to claim for robes

Its a non runner

mamutka

Thanks a lot, this makes sense. I presume I have to adjust for the tax then by adding it back?
My only concern is, why the lunches included in the expense claims along with mileage (when an employee is away on the client's site) can be deducted from the profit in tax calculation? This is the case in another business I'm engaged with.

srsly78

Subsistence is allowable in certain circumstances, when away from normal place of work: http://www.revenue.ie/en/tax/it/leaflets/it54.html

Citizenpain

Above relates to employees not soletraders

Some info here re soletraders ... Old do but I don't think the rules have changed !

http://www.revenue.ie/en/practitioner/tax-briefing/archive/tb31.pdf

mamutka

Info from Citizenpain's link:
Costs of meals may be incurred wholly and exclusively for business purposes where a business by its nature involves travelling (for example, in the case of self-employed long distance lorry drivers) or where occasional business journeys outside the normal pattern are made. A reasonable level of expenses incurred in these circumstances may be deducted from business profits.

This answers my question then! The said business involves everyday travelling, often a long distances, in order to do the job on customer's premises. There is a small part to be done in home office from time to time but would amount to 10% of the total working time.
I guess the best would be to confirm with the revenue.

I understand the Subsistence won't apply unless the person would become a director of limited company at some stage.

Thanks a lot!

srsly78

Yeah sorry, the subsistence rules above are for directors/employees. The principles behind them are similar tho. The tricky bit is the definition of "normal place of work".

mamutka

The employer’s business premises will be regarded as the normal place of work for an employee where:

travel is an integral part of the job involving daily appointments with customers; or
the duties of the employment are performed at the various premises of the employer’s customers but substantive duties are also performed at the employer’s business premises.


I think we're covered here in case of taking directorship.