If you’re self-employed and wondering what food expenses you can claim on your tax return, follow this straightforward guide.
The subject of food can be a bit of a complicated area when it comes to taxes, but, in certain circumstances, you’ll be able to claim your meals as an expense.
The bad news is those circumstances are few and far between and come with strict criteria. The good news is that if you meet the criteria, you’ll be able to expense your food costs.
In this guide, I’ll explain:
- What food you can claim on your tax return
- What amount you can claim
- Whether you can claim alcohol
- How to make your claim on your self-assessment tax return
This guide is for sole traders and side hustlers. Different tax rules apply if you have a Limited Company.
Friendly Disclaimer: Whilst I am an accountant, I’m not your accountant. The information in this article is legally correct but it is for guidance and information purposes only. Everyone’s situation is different and unique so you’ll need to use your own best judgement when applying the advice that I give to your situation. If you are unsure or have a question be sure to contact a qualified professional because mistakes can result in penalties.
What Food Can You Claim When You’re Self-Employed?
Claiming food expenses if you’re self-employed all goes towards reducing your tax bill, but the rules around what you can and can’t deduct as an expense can feel restrictive.
That’s because it’s difficult for HMRC to be certain they are 100% business related. So the rules are strict to stop individuals from claiming personal expenses for meals and drinks on their taxes.
- The cost of food and drink that you buy when travelling outside of your normal work pattern or daily commute is an allowable business expense;
- Your expenses for food and drink that you buy for personal reasons are not an allowable business expense, which includes times when you choose to eat away from your base of work;
- The costs of food and drink where an overnight stay is required is an allowable expense in addition to the cost of accommodation;
- Food, drink and accommodation where a trader is required to reside at the base of operation is not an allowable expense;
- Where your job is ‘itinerant by nature’ and involves travelling around to different locations on a regular basis, costs are not an allowable expense.
These rules apply to travel and subsistence. Different rules apply when it comes to client entertainment.
Can You Claim a Fixed Meal Allowance If You’re Self Employed?
There is no self-employed fixed meal allowance set by HMRC for food or drink. You’ll need to claim the actual costs of your meals and keep your receipts.
There are flat rates that you can use to claim for your home office and mileage, known as simplified expenses but these do not apply to food and drink.
- A self-employed bookkeeper normally works from an office she rents. She travels to see a potential new client and buys lunch while on the road.
The bookkeeper can claim food and drink as an allowable business expense because the journey is outside of her normal commute.
- A self-employed web developer agrees to work two days at a client’s office on a weekly basis.
Any subsistence costs are a disallowable expense because this is a regular trip.
- A self-employed hairdresser stays overnight in a hotel to assist with a client’s wedding.
The costs of food and accommodation are an allowable business expense.
- A self-employed long-distance lorry driver spends the night in their cab rather than take overnight accommodation.
The driver can claim food and drink as an allowable business expense.
- A sole trader normally works at home but decides to work from a coffee shop for the day, buying food and drinks during the day as she works.
The cost is not an allowable business expense because everyone must eat to live and these costs are not necessary for the purpose of trade.
- A self-employed gardener has a number of clients and visits their sites.
As the job is itinerant by nature the costs are not an allowable business expense.
What Amount Can You Claim?
Any claim for allowable food or drink as a business expense must be “reasonable”. Unfortunately, HMRC does not offer us a clear definition of “reasonable”. But the safest approach is to assume that what you buy should be on the more sensible side.
A meal deal from Pret would be acceptable. However, a night out with cocktails and lobster may not go down well with HMRC.
As with all other business expenses you wish to claim, you need to keep receipts to back up what you put on your self-assessment tax return.
DID YOU KNOW
You need to keep receipts to support details of any expense you want to claim on your tax return for 6 years. Read this guide to find out more about organising your receipts and storing them digitally.
Can Alcohol Be Claimed as a Business Expense?
We all like a glass of wine after a busy day. Similar rules apply but any alcohol must be bought with a meal to be an allowable expense.
It must also be reasonable – so a glass of wine or a beer rather than a whole evening in the hotel bar.
How to Claim for Food On Your Tax Return
You’ll need to claim the cost of allowable food in the self-employment section of your tax return. If your business turnover is less than £85,000 for 2023-24, you’ll have the option to fill in the simplified version of this part of the tax return. Therefore, you only need to enter your total expenses. You’ll need to include your food and drink claim in the figure you enter alongside your other allowable business expenses.
If your business turnover is more than £85,000, you’ll need to enter a breakdown of your expenses in the boxes set out by HMRC. Include your business food claim within ‘car, van and travel expenses‘
Whatever your business turnover, you should keep a note of what you are claiming for and how you worked it out as part of your business records. This is in case of an HMRC investigation and they ask for evidence of what you are claiming to check you’ve paid the right amount of self-employed tax.
In reality, claiming food on your tax return can be difficult. In most situations, you’d be able to claim for food costs where you are working away from your normal location but to be on the safe side that really means a significant distance from home, most likely with an overnight stay. And remember that any amount you claim must be backed up by receipts rather than just using a fixed daily amount.