The rules for allowable business expenses are generally similar for limited and unlimited companies, with some subtle exceptions. Where there are differences – these are identified in the guide below.
- This might include fines for late payments of taxes, speeding or parking fines on company vehicles. Although paid for by the company, these are not allowed for tax purposes so these should be clearly recorded in your accounts. HMRC will not allow a taxable benefit where an offence has been committed.
- However, if an employee were to be fined for speeding or parking in the course of their duties – the employer could reimburse the payment through payroll with the appropriate payroll taxes. In this case the ‘fine’ would become part of the employees taxable earnings – which is tax deductible.
We hope you find this series on expenses helpful. Please take a moment to check out our other articles.