This site uses cookies. By continuing to browse the site you are agreeing to our use of cookies. To find out more about cookies on this website and how to delete cookies, see our privacy notice.

Husband and wife partnership: Allowable travel expenses

Question:

The husband is a partner for profit sharing purposes only, and is not involved in the business. Wife has to travel a lot for the business and stays in hotels. Husband always accompanies her and all expenses for both of them are recorded in their bookkeeping (i.e. eating out, train costs, hotels etc.). As the husband is not involved in the business purpose of these trips (e.g. meetings and clients would not know of him), can all travel expenses be claimed as tax deductible or should I be disallowing 50% of travel costs, eating out etc.? 

Arthur Weller replies:  

I believe that you should be disallowing 50% of travel costs, eating out etc., as you have written. The husband’s costs are not 'wholly and exclusively' for the purpose of the trade. See HMRC’s Business Income manual, where the expenses of the spouse were not even initially claimed. 

The husband is a partner for profit sharing purposes only, and is not involved in the business. Wife has to travel a lot for the business and stays in hotels. Husband always accompanies her and all expenses for both of

...


This question was first printed in Business Tax Insider in September 2020.