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Post title image: Expensing it, without it getting expensive.

Expensing it, without it getting expensive.

Business travel, HMRC and the wholly exclusive rule.

Work From Anywhere

There has been a huge uptick in employees planning 'workations', either within the UK or abroad - a chance to relax and explore, as well as get your work done, all without eating into your holiday time.

Frome, SomersetFrome, Somerset

Stays exclusively for the purpose of the work are clearly tax deductible, but the big question is - does a workation count as business travel, to the extent that you can not only have your cake and eat it, but also have a bit extra on top (money)? The answer is... it depends.

The Rule

There's one very important rule from the corporation tax rules we need to understand to navigate this issue - the wholly and exclusively principle.

Put simply: the principle can only be satisfied if the sole reason for incurring the expense is for business.

If an expense has been incurred wholly and exclusively for trade, the costs can be used to reduce the taxable profits of a company (and therefore the corporation tax payable - i.e. the process of expensing).

Books have been written on the subject, and case law is constantly evolving, so if this excites you, then good news - you can read about this at extreme length at your leisure.

Wye Valley, WalesWye Valley, Wales

For the rest of us, some of the important elements that have been used to interpret the principle include:

In summary, deciding whether or not any part of a trip is expensable relies on the fundamental purpose of the trip, namely whether it is clearly for business reasons.

Avebury, The CotswoldsAvebury, The Cotswolds

Other considerations

Alongside the cost of the stay itself, it's also worth bearing in mind a few other items which may be expensable, and some other considerations:

The Cairngorms, ScotlandThe Cairngorms, Scotland

In conclusion

How best to ensure you don't fall foul of the rules, and plan out your perfect workation trip?

Finally, if there remains any uncertainty over your stay, the easiest thing to do is talk to a professional with detailed knowledge of your particular tax situation.

Planning a small individual trip?

Start here with our 1-2 bedroom properties:

The Atelier (Brecon Beacons, Wales)

The Rapids (The Wye Valley, Wales)

The Taigh (The Cairngorms, Scotland)

The Studio (Stoke Fleming, Devon)

Going away as a group?

Explore our most popular large properties:

The Worker's Cottage (Sandringham, Norfolk)

The Grain Store (Lewes, East Sussex)

The Orangery (North Devon)

The Blackwood (Cromer, Norfolk)

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