HM REVENUE & CUSTOMS ARE DRIVING UP TAXABLE PROFITS
Last September HM Revenue & Customs hit upon an idea to reduce the motoring expenses deducted from your profits and thus increase their tax take.
The Income Tax and Corporation Taxes Act was passed in 1988 and ever since then it has been standard practice for osteopaths to charge as an expense for travelling between places of work. Over the years we have had several Revenue enquiries into client’s accounts and this has never been flagged up as an issue.
They have now decided that such an expense fails the “wholly and exclusively” test as laid down by s74 (1) (a) of the Act. The argument is that this is merely commuting and not an active part of the work that you do.
Thought should be given as to what motoring costs you are going to be claiming from now on.