I asked my account and she tried to explain twice to me.
Why is it better to put client entertainment through your company and not pay it directly if it has no tax relief at all???
[quote]The reason why it is worthwhile putting entertaining through the company is that it is a legitimate business expense (you can pay it directly from the company account or personally then reimburse through an expenses claim). It is added back before the corporation tax is calculated but the adding back is done on paper only, the money never actually gets paid back.
If you don’t put it through the company then you would be using money you have withdrawn as your personal income. This means you are wasting some of your personal tax bands by using them to withdraw money that is for business use.
[quote]
Why is it better to put client entertainment through your company and not pay it directly if it has no tax relief at all???
[quote]The reason why it is worthwhile putting entertaining through the company is that it is a legitimate business expense (you can pay it directly from the company account or personally then reimburse through an expenses claim). It is added back before the corporation tax is calculated but the adding back is done on paper only, the money never actually gets paid back.
If you don’t put it through the company then you would be using money you have withdrawn as your personal income. This means you are wasting some of your personal tax bands by using them to withdraw money that is for business use.
[quote]
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