When you live with your client as a carer the line between home and work gets a bit blurred. That means, in turn, that it can be hard to work out what’s personal expenditure and what you can claim as a business expense.

Over the years, I’ve met a few self-employed live-in carers who are puzzled by this, and understandably so. They’re effectively at work 24/7, after all. So it’s no surprise they might wonder if they can claim things such as medical prescriptions, clothing and food as business expenses.

But, no, of course you can’t claim everything, but to get this right, you need to understand an important principle in tax law – the ‘wholly and exclusively’ rule.

That means the expenditure you’re claiming must be incurred wholly and exclusively for the purposes of doing business. And limited companies have a third condition to meet, too – it must also be ‘necessarily’ incurred for business.

So, for example, think of a branded tunic you wear while performing your caring duties, but would never dream of wearing out for a night on the town. That’s a great example of something that’s wholly and exclusively for business and so definitely an allowable expense.

But a pair of comfy trainers you wear at work, on your evening walk and on your day off? Probably not.

Let’s have another twist, though: hard-wearing waterproof slip-ons you wear only while mopping and cleaning your client’s living space? Now we’re talking.

Travel can be more complicated.

As a rule, you can’t claim travel to and from your usual workplace – otherwise, everyone on commuter trains into London each morning would be writing their travelcards off against tax! For live-in carers, that’s potentially a non-issue – they live where they work. Even if you have more than one client, as long as you have a regular routine, those would probably both be considered your ‘permanent place of work’.

If you work through an agency and get assigned to a client in another part of the country for six months, you could claim for travel costs and/or those associated with your temporary relocation.

But what about, say, trips to the pharmacy to pick up prescriptions, or the weekly supermarket shop for your client? It’s hard to sum up in a few words but, as a rough rule of thumb, claiming for an unusual work-related journey that sends you, say, ten miles out of your way will probably be given the nod by HMRC. But claiming for the weekly run to the local Co-op might get you in trouble.

Similar rules apply to food. You have to eat breakfast, lunch and dinner whether you’re at work or not, so HMRC says you can’t generally claim food as an allowable expense. If you have to buy a meal out, perhaps because you’re accompanying your client on a day trip or hospital visit, it is worth keeping the receipts. Just bear in mind that the cost should be reasonable (no five-course lobster dinners) and incurred as a direct result of your work.

If you want to know more about the principles behind allowable expenses, or want to talk about your particular circumstances, call me on 07803 782100 or email me jon@red76tax.com