I have a client who is a freelancer (director) for a Ltd company. She tends to purchase a lot of food any time of the day and some times it can be as much as £60 in a day is this allowable and what is a reasonable amount?
We eat to live, not eat to work therefore it fails the duality of purpose test and cannot be considered a purchase wholly, necessarily and exclusively for the purpose of the business.
When staying away from home for work (and only when staying away from home wholly, necessarily and exclusively on business purposes) there are some additional rules in the directors favour.
Before your director can use these rates they will need to inform HMRC of their intent on a P11DX.
The rates are :
Where away from the normal place of work for 5 to 10 hours a meal allowance of up to £5 is allowable,
Where away from the normal place of work for more than 10 hours a meal allowance of up to £10 is allowable.
Where finishes late (after 20:00) then a meal allowance of up to £15 is allowable.
Even though for the above the director will need to have an HMRC dispensation in place the director will still need to retain invoices for the meals consumed and evidence that they were consumed whilst wholly, necessarily and exclusively on company business.
The whole idea of £60 per day is to my mind a non starter although don't act upon my reply until others have had chance to chip in.
kind dregards,
Shaun.
__________________
Shaun
Responses are not meant as a substitute for professional advice. Answers are intended as outline only the advice of a qualified professional with access to all relevant information should be sought before acting on any response given.
