Self Employed expenses - Packaged account Bank Charges

wolverine03

Hi guys

Got a Halifax Clarity current account with a £15 bank charge and £5 monthly credit if £300 is spent on it.

I have 30% of Business transactions going through them.
Can I claim £3 per month as a bank charge? = (15-5)x30%

Thanks

HappyMJ

No...you should have a separate bank account for business expenses. What does the £15 cover? If it's mainly for the mobile insurance then cancel it and get a insurance policy covering the business mobile and it wll be claimable in full.

wolverine03

Currently dont have a seperate account, but ill consider it.

If the Halifax Clarity became my biz account, would the £10 (15-5) monthly fee be tax deductible/allowable expense?

It covers travel ins, roadside assistance, mobile phone cover etc...

bubblegumcola

Are you self employed? My DH is self employed and was contacted by his bank over a year ago telling him he HAD to have a business account separate from his personal current account. I'm not sure if it was some new legislation? He has been self employed for over twenty years, just himself nobody else in the business but they said he had to open an account. Costs him a lot in bank charges that he never had before so my DH is not particularly happy at all about it. He did have his first year free so it's not been taken into account for these accounts he has just had submitted to his accountant. Surely bank charges are an allowable expense?

Kynthia

Any expenses that are 'wholly and exclusively' for the business would be allowable, and charges on your business's bank account would fit that. Using your own current account doesn't as it's not just for the business.
However I think your bank would give you a business account rather than a normal current account so the charges would be different from what you currently incur.

newbie1980

hi
every bank expense via buisness account is tax deductable
the only down side is you pay for every cheque/debit card transation/cash in/direct debit

basically everything that goes into out of the account has a charge
cash is the most expensive i normally put into personal account and fp it over but still there is a small charge of 30p or something

Savvy_Sue

It is worth shopping around for business accounts, Martin has an article on the main site and there are discussions on the Small Biz board. bubblegum's OH must know what he needs from his account, in terms of does he need access to cash (if not then an account you can operate online and post cheques off is fine) / how many cheques does he write / pay in and so on.