Company Travelling Expenses

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This discussion clarifies whether an IT company can book employee trip expenses, such as bus and hotel rentals, and food, in its accounts. The consensus is that reasonable expenses are allowable for corporation tax if they are wholly and exclusively for trade purposes, such as boosting staff morale. There isn't a strict limit; actual reasonable expenses incurred are generally permitted.

Dipak Yeshi

Dipak Yeshi (Querist)
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01 December 2021 I am working in IT (Information Technology) company and they have planning outside trip every year for employee's , So can company book trip expenses (i.e Bus Rent, Hotel Rent, Food Expenses) in there books of account. If yes what is the expenses limit.

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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01 December 2021 Yes, reasonable expenses allowed.
Staff entertainment is an allowable expense for corporation tax purposes provided that it is wholly and exclusively for the purposes of the trade. Common examples of this are meals, parties or other entertainment undertaken to boost staff morale.

Dipak Yeshi

Dipak Yeshi (Querist)
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02 December 2021 Dear R Seetharaman sir , Thanks for the reply.
There is any limit for the expenses.

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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02 December 2021 Actual expenses allowed.

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