During the lockdown, most people have been working from home, often involved in online meetings with customers and staff. Where food is consumed during the working day can you claim a tax deduction for the cost?
Tax deductible food
Whether tax can be deducted for the cost of food has been the source of many disputes with HMRC over the years. These days the position is clearer although not trouble free.
Wholly and exclusively
As you probably know, the tax rules prohibit a deduction for expenses unless they are “wholly and exclusively” for the purpose of the job/business. As food is required for personal reasons (you need it to live!) it inevitably fails the wholly and exclusively test.
However, practice and case law eventually settled on an imprecise compromise where HMRC would allow tax relief for the cost of food where it was linked to a business journey.
The rule is that if you incur expenses in the course of business travel, you’re also entitled to a deduction for the “reasonable” cost of food and drink.
In short, if there’s tax-deductible job-related travel the cost of food and drink for subsistence is also tax deductible.
So where does that leave our home workers?
Unfortunately, as there is no business travel there is no entitlement to tax relief on the cost of food and drink.
How we can help
If you need support or further information please contact Esther Guy on 01737 652 852.