A Guide for allowable contractor expenses in Ireland
Here is some general information of what you can claim back as expenses while contracting through your own Limited company in Ireland.
- Allowable expenses are expenses that have wholly, exclusively and necessarily incurred for the benefit of the company and in the performance of the duties of the director.
- Records and receipts should be retained for 6 years in case of a Revenue inspection or audit.
- All expenses are subject to Revenue approval and are not guaranteed to be accepted.
- 1. Entertainment: Client entertainment expenses are not an allowable expense for corporation tax purposes under Section 840 of Taxes Consolidation Act 1997. Staff entertainment expenses are allowable.
- Clothing: The purchase of business clothing or dry cleaning is not an allowable expense by Revenue. Safety clothing e.g. hi-vis jacket or safety boots is an allowable expense.
- Subsistence: Travel and subsistence expenses incurred while you are working away from your normal place of work due to business reasons are allowable providing they meet certain criteria. Expenses that meet the criteria can be reimbursed tax free provided they are made using civil service rates. A detailed log must be kept including date, location, distance involved, client/business and/or reason for journey in case of revenue inspection.
- Taxi: Taxi expenses which meet certain criteria are an allowable expense. However, a taxi expense relating to travelling to and from work is generally not an allowable expense unless it meets certain criteria e.g. working after 10pm or before 6am.
- Motor Expenses (Diesel/Petrol/Mechanics): These expenses are allowable as long they meet certain criteria. It would be advisable to keep a record and log of business journey’s in case of revenue inspection.
- Other non allowable expenses: Work gifts, recreation activities like Yoga retreats etc would all be non-allowable expenses.
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