Reply To: More on Self-Employed Expenses


I agree that the phone use is reasonable, but you seem have missed off the part of the test that asks whether the expense is “wholly and exclusively” for the purposes of the business. I don’t see how it can be.

Any element of personal use would mean the expense is not allowable unless it is possible to apportion the expenditure somehow. With things like petrol this makes sense – each time he uses his car, he is using up some of the petrol either for personal or for business use and by apportioning you are making an estimate of how much is used for each.

I don’t see how you can do that in this case. The calls themselves cost nothing because he’s already paid for a package which gives him free calls. Therefore they have no separate value that you can attach to them. Even if you say he uses the phone for business use 50% of the time there is no separate set of the calls that cost him £15. Each call is not using up some resource like petrol that can be valued separately from the other calls. If you can’t split the £30 into parts then it has to be taken as a whole, and as a whole it is not exclusively used for the business.

It’s possible of course that tax law has something different to say about this and that I’m completely wrong 🙁 but this is my reading of the words wholly and exclusively.