I took a 6 month lease (minimum period permitted by landlord) on a cottage to live in for the duration. My main residence was some 300 miles away in another county where my family remained.
We charged the full rental for the period as a business expense to the accounts for the trading period. The Inspector has come back and told us that, and I quote: "this is not a business expense and is specifically disallowable under S74(b) ICTA 1988.
The fact that your client resided away from his main home does not mean that the deduction claimed is allowable".
I looked up the INCOME TAX (TRADING AND OTHER INCOME) Bill on THE UNITED KINGDOM PARLIAMENT HOUSE OF COMMONS - EXPLANATORY NOTE....website. It says under Section 74 of ICTA 74(1)(b) of ICTA that and I quote: maintenance of the parties , their families or establishments, or any sums expended for any other domestic or private purposes distinct from the purposes of the trade, profession or vocation" are prohibited deductions.
I think the word "distinct" is in our favour here, since I was "essential" to the operation of the business for the period.? NOT TO MENTION THE LOGISTICS.
Perhaps there is other legislation that supports my case, or, perhaps my argument may be sustainable?
Thanks,
alexander