Is it fair to split meals 50/50 if one person claims it all on expenses?

[mrsbeeton999]

Im not self employed so not sure how it works but my besties bf and her take it in turns paying for meals and drinks out. He expenses everything so effectively never spends a penny. His work is a lot of entertaining clients. She’s not bothered by it but I’m judging him as a CF. Am I correct or misunderstanding how self employed expenses work ?

You can’t claim the vat back and it isn’t deductible for corporation tax.

The only benefit is that if he took it out of the business as cash he’d pay income tax on the cash. By spending it before deducting it he's saved on income tax.

He could also be deducting his personal expenses/spends from that credit card and only claiming back genuine work expenses. It will all go though his accountant anyway. Yr friend is not bothered so none of your beeswax!

"I realise he shouldn’t be claiming it as it’s not work but also think he’s really cheeky as she’s spending her hard earned money taking him out but he never actually spends anything on her so it’s as though she is more invested in the relationship than him if that makes sense"

If she feels this, she needs to voice this to him. It really is all none of yr business.

"@RudestLittleMadam Cheeky cunt. I’d not be impressed by that either. Mind you, I’m not sure his employers would be pleased either."

He is self employed. He is his boss!

He's self employed. He's getting a bit of tax back on it, the gov isn't just giving him the money he spent. YABU it's still costing him money.

He's also not sharing his tax claw-back with her.

All in all, not great.

I used to hang around with lots of journalists who did this.

We'd go out, all pay the bill, the journalist friend would take the receipt and add it to expenses for a story they were doing.

It was annoying.

Well it sounds a bit tight of him but not the end of the world. That said my Brother expensed a meal I had with him recently, but (by sheer coincidence) the company I work for is a big client of the company he works for and we did spend a lot of the time talking work so it was at least partially legit

Honestly it doesn’t reflect well on your friend that she’s ok with dating someone who evades paying their fair share of tax. It’s a horrible and unethical trait and I wouldn’t dream of progressing dating with someone once I found this out. I’ve got no time for people like that. No morals and no social conscience, yuck.

Its tax evasion. But he is actually paying for the meal. He isn't getting the meal for free.

He is just paying slightly less tax by putting in more business expenses.

I didn't realise that it was wrong tax wise (never worked for myself) until I was older as all my friends self-employed parents did it.

You aren't bothered about it being dishonest from a tax point if view so don't get why you have an issue with it when she is fine about it.

Depending on what he earns and his the business is set up it’s probably saving him about 7percent (basic dividend tax rate). If he operates a limited company most of the tax is taken as corporation tax and if isnt deductible for corporation tax

Well, actually he isn't saving anything as one other poster has also said! If he is expensing it as business entertaining, it's not actually tax deductible.... So I'd leave him purely on the basis that he is trying to outsmart the tax man, but isn't saving anything!! Douchebag

You need to mind your own business Op. How do you know so much detail about his finances?

As he is self employed, who did you think he was claiming it from?! Whether or not you have ever been self employed, surely the clue is in the name?

He's fiddling his taxes. Not a good person. Yes he's a CF. Your friend isn't bothered now but his CF-erry will come through in other ways if sye gets more involved with him, and she will end up royally screwed over sooner or later as his type will always put their own wellbeing before anyone else's. But you can't fix people or live their lives for them.

It's fraud. There are strict rules about when self-employed people can claim food expenses. Also, you can't pay for others' food.

@mrsbeeton999

And the time she spent £80 cash on a meal he took the receipt off the table at the end of the meal presumably to claim that too 😮

He'd have to show the meal coming out of his bank account too to claim for it. But he sounds pretty sleazy anyway....

If he is self employed, where do think he is getting the money from to pay for the food?

He is paying for the meals from his own pocket, just as she is. From his income. There is no such thing as “claiming it back on expenses” for self employed people. At the end of the tax year, when his accounts are submitted, he can put in receipts that may be accepted by HMRC as tax deductible. Which will mean that those amounts come off the total income he is credited as having (depending on the rate of tax he pays, that effectively means he might get 20 to 40 per cent of the money spent back many months after he has spent it).

There is a real issue though between with HMRC. The meals plainly are not business expenses and he is wrong to claim them as such. This is tax evasion and is both morally wrong and illegal. It’s also pretty stupid as HMRC are very alert to such tricks. So he is unreasonable in many ways. But he is not, in my view, a CF so far as your friend is concerned.

@mrsbeeton999

I realise he shouldn’t be claiming it as it’s not work but also think he’s really cheeky as she’s spending her hard earned money taking him out but he never actually spends anything on her so it’s as though she is more invested in the relationship than him if that makes sense

It's illegal and immoral for him to be doing this. However if they are doing 50/50 (even if it's by you pay this time, I'll pay next time), neither person is really taking the other one out. I expect he gets a NI and Tax break on the bill rather than full reimbursement so he will be paying something out of his own money. Is the bigger issue why she is happy to be with a man who does not want to pay his way in society?

66% don’t understand how expenses work!! He does not ‘get it all back’ there’s a tax reduction worth 20% of the meal. It doesn’t affect you, you can’t do it because you’re not self employed so why does it bother you?