What travel expenses can a Salon Owner claim, & why bother?
We are asked this a lot by Salon and Barbershop owners, so here’s a quick guide we’ve put together:
The golden rule
The golden rule (which has been set by HMRC) is that you can only claim for business travel.
What is business travel?
Any travel that you incur in relation to running your Salon or Barbershop.
As a test, think about whether you would have made that journey had you not had the Salon.
Examples of business travel are:
- Travelling to a supplier to pick up hair product
- Travelling to a venue to undertake the latest training in hair colour
- Travelling to a hotel to receive an award for your Salon
- Travel to your Bank to pay monies in, or meet with the Bank Manager
- Travel to a Client’s home to provide services
What is not business travel?
Home to work travel is not allowable by HMRC in any industry.
For Salon and Barbershop owners, they consider such travel to your “work place” to be ‘regular and predictable’ and so falls into the non-allowable expense of commuting.
If however, you have more than one salon, travel between them is allowable.
What does claiming actually mean and how do you do it?
It means either:
- paying for your travel using the business’s money (either cash from the till or using the company debit card)
- paying for the cost yourself and then putting in a “claim” to your business to reimburse you
- if using your own vehicle, then putting in what’s called a mileage claim
For the first 2, simply provide your accountant with the details and the ticket or receipt. For the last one, provide your accountant with details of the journey and the mileage involved (both ways!).
They can then put the cost through the books.
Business travel is allowable for tax, so this has 2 implications:
- Your business can offset the costs against profits – and so reduce the business tax it has to pay
- As owner, you can extract money out of the business without incurring personal tax or NIC
So very worth doing!
As well as the cost of the travel itself, other costs can be claimed – such as parking and congestion charges.
For longer business trips (for example, attending an awards ceremony in a different city, or attending a 2 day residential training course, or just heading to the other side of London for the day for work), additional costs can be claimed. Largely these are lunch, dinner and hotel costs but there are additional requirements around these claims.
Feel free to contact us if you need advice on anything to do with travel by clicking here: Contact