Business meals and tax-deductible meals & expensed meals for work

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Introduction 

From day to day, we all need to eat to survive as human beings. However, when you’re UK contracting or at work during the week, at what point do you receive a business meal or business lunch tax deduction? Further to this, when can I claim for business meals and on what occasions are business meals tax-deductible? Key to note, all allowable business expenses for contractors should be wholly, exclusively and necessarily incurred for business purposes. Therefore, if there’s times when contractor meals and business lunches are genuine contractor deductions, in which cases do you receive business meals tax deduction as part of expensed meals for work? In this guide, we’ll look at claiming food as a business expense and when expensing business meals is allowable. Also, we’ll research in which instances one can claim limited company food expenses while they work, and when will they incur tax-deductible meals.

UK contractor and small business owners will often ask the question, when is lunch a business expense? They’ll also ask, when eating out on business, what expenses can independent contractors deduct? What’s more, a further thought for many is when are business meeting meals tax-deductible? If we look into can a contractor claim travel expenses, the answer is they can when the travel relates to genuine business trips. Indeed, the same applies If you’re to receive a work-related meals tax deduction.

In this guide, we’ll research in what situations you can go ahead claiming lunch expenses (HMRC guidelines) and contractor dinners and where you’ll receive an independent contractor meals deduction. When you’re contracting and incur meals, business expense deductions only apply in certain scenarios. Therefore, in this guide, we’ll look at claiming food expenses (limited company) and in which instances are company meals tax-deductible.

Initial thoughts 

What to think about first

When we consider tax-deductible meals and when is lunch tax-deductible, let’s look at a limited company contractor or small business owner eating alone. Under this scenario considering tax deductions for meals, it won’t include with colleagues as this is an entirely separate issue. Therefore, we’ll not delve into meals you consume as part of entertainment costs. Certainly, this includes certain business meeting meals with clients or suppliers. To sum up, this is because we cover meal and entertainment expenses and other entertainment activities elsewhere on this website.

Generally, if we research when are business lunches tax-deductible (UK) or when are meals tax-deductible, we need to consider if you incur these for business purposes. Therefore, they should be wholly and exclusively for the purpose of your trade or activity. Indeed, when we look at when are meals for contractors deductible, any such expensed meals for work reasons while contracting, must pass the test wholly and exclusively for the business. In general, when we consider what are UK contractor allowable expenses, this rule applies across all types of costs.

Common questions

Many UK contractors or independent workers will likely have questions on when they can claim business meals. These include expensing meals when working away overnight or when visiting a client or work site. Therefore, such questions will likely include:

  • Are meals a business expense?
  • What counts as a business meal?
  • Are work lunches tax-deductible?
  • Are business meeting meals tax-deductible?
  • Can I claim food as a business expense?
  • Are food expenses tax-deductible?
  • Can I claim food expenses and without receipts?
  • Can I deduct my lunch as a business expense?
  • Is lunch at work tax-deductible?
  • Can you claim for lunch if self-employed?
  • Is a business dinner tax-deductible?
  • Is food and drink tax-deductible?
  • When can you claim food as business expense?
  • What qualifies as a business meal expense?
  • What food expenses are tax-deductible?
  • Are staff lunches tax-deductible?
  • Can I claim meal expenses on my taxes?

In this guide, we’ll take a look at these questions in more detail. What’s more, we’ll find out when you receive a business lunch or business dinner tax deduction through your company.

How to claim business meals 

Let’s look at can you claim lunch as a business expense (UK). As part of this, let’s research when can I receive a business meal tax deduction and, if I can do this, what’s the process? Basically, the process when claiming allowable business meals is as follows:

  • A limited company owner will claim these through their company expenses to reduce the business overall tax bill.
  • A sole trader or self-employed person will claim the meals through their personal tax return to reduce their individual tax bill.
  • Staff members of a business can make claims based on their employer’s expenses policy. In terms of is a staff lunch tax-deductible, if the meals are genuine expenses per HMRC rules, the employee can claim these. If the employer doesn’t reimburse the total value of these, the employee can make a claim through their tax return if they register for Self Assessment.

HMRC has detailed guidance on what you can claim and when you can claim for work meals. This basic HMRC guide covers what you can claim, whereas NIM06250 explains when you can make a claim. Also, HMRC’s technical guidance page goes into more detail on what you can claim.

Business meals -daily work meals 

If you’re a UK contractor or consultant and travel to the same work site each day, you may wonder when are lunch expenses tax-deductible and whether you’ll receive a tax deduction for meals at work. Certainly, any potential tax-deductible food expenses will include meals, beverages, and refreshments. The answer is that as they’re part of your daily work routine, your meals are generally not an allowable expense.

When are meals tax-deductible? 

Preliminary thoughts 

When can I claim my lunch as a business expense (UK)? What’s more, when can you claim meals as a business expense and what’s the conditions as part of this? In this guide, we’ll take a look at this in detail and find out what the rules are. We’ll look into when you can claim these and what you should think about when you make a claim.

When we research are business meals tax-deductible, there’s two areas where you can claim for work-related business meal expenses. Therefore, you’ll incur tax-deductible meals if you can show that these meals are exclusively for the purposes of the business. If your meals are business costs under the tax rules, you should keep a record of these. What’s more, when you can make a claim, you’ll receive a 100% business meals tax deduction.

Examples of what meals are tax-deductible for business purposes 

When we research when can I claim meals as a business expense, as mentioned there’s two main areas to consider. Both are when work-related contractor lunches and meal expenses are tax-deductible for your business.

Locations that aren’t part of your `usual’ work routine 

If you work at a remote site or one that isn’t part of your `usual work routine’, are business meals tax-deductible? Indeed, they do save tax and you can claim the actual meal costs or a meal allowance if you’re on legitimate business. In turn, the meal costs will be genuine tax-deductible meals.

Staying away from home overnight 

You’ll incur accommodation expenses, including business meals, when you work away from home overnight. In this instance, you can also claim a business meals tax deduction and put through expensed meals for work for your food costs while away for work reasons. On the other hand, you can claim a meal allowance when you stay away from home overnight for work reasons. This includes when you work abroad, if you work on an overseas assignment.

Summary -claim for your business meals / daily business lunches 

When you can claim business meals?

To clarify the above, if you run your own business and consider are meals tax-deductible, they’ll only be allowable expensed meals for work in the following circumstances:

  • If you travel to sites that you don’t otherwise travel to under your `usual’ work routine; or
  • If you stay away from home overnight.

Therefore, you can go ahead with claiming lunch expenses and expensing meals while you work away, when your business journey fits the above criteria.

How you can claim business meals?

In brief, if you can claim the cost of your food and drink, these expenses will be a business tax deduction. Therefore, you can include business lunch expenses and meal costs as part of your business travel expenses:

  • Within your company expenses, if you run your own contractor limited company.
  • On your tax return, if you’re self-employed / a sole trader.

If you’re using digital software to keep your records, the business lunch expense category to use will be travelling costs or meal costs.

HM Revenue & Customs (HMRC) guidelines 

When can you claim food expenses -self-employed (UK) 

Are meals tax-deductible for self-employed individuals as well as limited company contractors? i.e., is there a tradesmen tax deduction or a self-employed daily food allowance available? Basically, under HMRC’s guidelines and business meals tax deduction rules, as a self-employed person (by this we would take it to include someone who’s a sole trader but also UK contractors who are directors of their own company), you can claim for “reasonable” costs for a business meal. This includes food and drink expenses for self-employed people when you’re travelling on business, if:

  • Your business is, by its nature, itinerant. For example, you’re a commercial traveller.
  • You’re making an “occasional business journey outside the normal pattern.” For example, you’re a home-based illustrator and travel to Manchester to meet a new publisher.
  • As part of your work, you stay overnight on a business trip and claim the cost of accommodation and meals. It’s key to note that you can also claim Personal Incidental Expenses (PIEs) when you stay away from home overnight for work reasons. When you claim for these costs, they’re subject to the 24-month rule. This means that you mustn’t be contracted to be based at your current worksite for longer than 24 months.
  • HMRC has extended this to “traders who do not use hotels.” Specifically, long-distance lorry drivers who sleep in their cabs can also claim the cost of their meals, even though they don’t claim the cost of accommodation.

Therefore, when we consider expensing food for business, please take the above guidelines into account.

Business meals “reasonable” costs -what are these? 

In the case of what and when is food tax-deductible (UK) for the self-employed, HMRC doesn’t define a “reasonable” expense. When looking at work-related business meals for employees, they give an example of “having an elaborate menu and fine wines” as “meals on an unreasonable scale.” Therefore, you’re well-advised not to claim any meals at lavish establishments that charge an arm and a leg otherwise you may not receive a business meals tax deduction. 

HMRC standard meal allowances 

The HMRC standard meal allowances (working away from home) are fixed dally claim rates for meal expenses (HMRC). These are effectively a contractor subsistence allowance when you’re working away from home and away from your regular place of work. What’s more, the tax office will update the amounts that can be claimed as meal/subsistence allowances annually. As of 2023, the official HMRC meal allowances are:

Minimum journey time Maximum amount of meal allowance
5 hours £5
10 hours £10
15 hours (and ongoing at 8pm) £25

Final thoughts 

In this guide, we’ve summarised when are your contractor expenses tax-deductible, in terms of business meals and a food tax deduction. Therefore, as part of determining when are business meals tax-deductible, we outline the two areas above when expensed meals for work will be allowable and tax-deductible meals. As with all business expenses, you should obtain receipts if you claim expenses for business meal costs. This includes when you incur tax-deductible meals as part of your work. What’s more, you should keep thee receipts for any business meals in a safe place for the future. This is because they’re proof if the taxman ever asks to see these at a later date.

Depending upon the type of work that you do, you may also be able to claim your business clothing. However, there’s specific rules to bear in mind concerning what you can claim.

Finally, please remember, when you consider can you claim food as business expenses, you’ll receive a business meals tax deduction which will help reduce your tax bill when:

  • You travel to a site outside your `regular work pattern’; or
  • You stay away from home overnight for business reasons.

Link to Contractor Advice UK group on

LinkedIn    https://www.linkedin.com/groups/4660081/

Published On: January 4th, 2024 / Categories: Expenses, First timer guide /

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