Expenses are anything which is purchased or charged for the purposes of running your business. It has to be wholly and solely for business purposes to be claimed.
Expenses are things such as the SW Fees and Rent (these were added in the previous ‘income’ section, but you then take them away as expenses once you have your true income figure).
You may also have receipts around the house for items you purchased (did you buy anything from the eshop? look in your email for a digital receipt!) and you’ll find a load of items for the previous tax year which you can use. However do ensure that you’ve only included items for with the dates of the last financial year.
Splitting a bill
On occasion there may be items which are split between personal and business use (e.g. mobile telephone). Where this is the case, you should appropriately proportion the business use to calculate the amount which can be claimed. For example, if you use your mobile 50% of the time for business, you can claim half of the bill. Keep a note of what usage has been business, so that you can evidence if required.
We’ve provided some key expenses below to start you on looking for your receipts. Get these all together in a box or file to try and make things easier – then label the box and keep it somewhere handy.
Hotel Accommodation and Food
If you need to stay away from home for a short period (such as for training), you can claim for hotel or accommodation. A hotel stay at a nearby location would be acceptable – however a 5* hotel stay may be questioned by HMRC.
Subsistence
Not to be confused with subsidence (that’s when something sinks), but subsistence is the fact that everyone needs to eat and drink to live – and HMRC do accept this. Therefore when you’re away on business for training or development, you can claim reasonable expenses towards meals and drinks you have during an overnight stay. You may have receipts from motorway service stations when driving long distances for business purposes, and again these can be claimed. Alcohol is a common misconception – HMRC will allow a reasonable amount, such as a drink with dinner or half a bottle of wine), but anything else could be questioned.
Additionally, gifts of alcohol (Such as to social team members at Christmas?) are again not the best use of business funds – so these may be a personal gift, not a business expense.
Card Payment Machines
Do you have a EFT Card Payment machine? If they charge you a 0% or monthly fee, this can be claimed. Most merchants will provide you with a monthly statement.
Clothing
Where the clothing is branded (e.g. through the eshop), these are claimable – however usually only uniforms are permitted. If you’ve bought an outfit to use at group which is unbranded, HMRC will not allow this, as you could in theory wear this anywhere outside of the business.
Goods for Resale – your group shop
In your group shop, you may sell a range of books, diaries and even branded items like SW umbrellas or clothing.
These are purchased on the eShop and then are then sold at a slightly different price, and this is not ‘commission’ but ‘profit’. This is because you purchased the item at a lower cost, and then sold at the higher amount. The difference is your profit, and is taxable. It is recommended to keep up to date stock sheets to track purchases of books and selling amounts to keep your records up to date.
Magazines and Biscuit bars are different (as are any items on a sell or return basis). The amount you receive for each sale is classed as ‘commission’ and comes under your income (and is on your PFS document) as you don’t pay £1.75 to SW for a magazine which sells at £1.95.
However, If you do not return Magazines, or Hifis go out of date and you are invoiced for these at a later point at full price from Slimming World, this can be an expense.
Storage costs
Do you rent a storage unit for your SW items? If it’s exclusively used for business, it’s claimable.
Legal or Financial Charges
These could include ICO/GDPR Annual Fees, any charges by your bank for using a business account such as bounced direct debit charges – even those charged by SW if your direct debit is late
Insurance Policies
You can claim for insurance policies or charges which are wholly for your business use, such as:
- Payments for Slimming World Insurance (St Benedicts Insurance)
- Business Mobile Phone insurance
- Business premises insurance (for example if you rent a locker/storage unit)
Marketing and Advertising
This can include a range of items such as:
- Promotional materials – leaflets, visuals, banners
- Online advertising – Facebook Adverts, Google Adsense
- Offline advertising – Billboards, leaflets, newspaper advertisements or classified ads
- Local advertising – mailshots, leaflet distribution companies, local shop charges for
- advertising in windows/notice boards
- Text messages – such as using a specialist company like TextLocal
- Free samples – such as sampling in group, free samples of HiFi bars (for members,
such as to advertise a new flavour) - Website charges – where you have a blog or website to promote your group
Subscriptions
Any recurring subscriptions which you may have (such as Microsoft Office 365, Google Drive, even Malgra Plus) can be claimed if they were purchased for the sole use by the business.
Office and Equipment
There’s a range of items you need at home, such as stationery, envelopes, corex – we’ve provided a list below with some ideas, but the list could be endless!
- Pens
- Paper
- Printer Ink
- Dymo address labels
- Postage (Stamps or Franking Machine charges)
- Envelopes
- Computer software (such as Microsoft Office 365)
- Corex – for displays
- Day-glo stars
- Member card PVC holders
- Boxes for stationery storage
- Acrylic signs for in group
COVID-19
Any items purchased for your business, to aid with the safe running of your group, are allowable expenses.