MOTOR RACING SPONSORSHIP WAS TAX DEDUCTIBLE

Written by AC Accounts
July 13, 2017
Insights

In order for an expense to be deductible against business profits it must be incurred “wholly and exclusively” for the purposes of the trade.

In a recent tax case a hotel owner near Silverstone sponsored his grand-daughter’s career as a racing driver by making payments through his company. The argument was that this would promote the motorsport credentials of the hotel, rebranded as Silverstone Hotel. The granddaughter was well known in motor racing circles and her endorsement of the hotel was designed to promote the company’s business.

HMRC sought to disallow the expense on the grounds that there was a “duality of purpose” and consequently not incurred wholly and exclusively for the purposes of the hotel trade. However the Tax Tribunal allowed the company’s appeal and consequently the payment was tax deductible.

Need Help?

Book a Free Consultation

PrevPrevious PostONE BUSINESS OR TWO FOR VAT?

Next PostStamp duty on second homesNext

A&C Chartered Accountants is the leading independent accounting firm in Manchester, providing accounting and business advisory to startups, sole traders and SMEs.

Facebook-f Linkedin Instagram Youtube

Useful Links

About Us
Services
Testimonials
Contact Us
Privacy
Cookies

About Us
Services
Testimonials
Contact Us
Privacy
Cookies

Get In Touch

info@ac-accounts.co.uk
0161 962 1855
Manchester City Centre: 53 King Street, Manchester, M2 4LQ
Sale, Cheshire: 1A Marsland Road, Sale, Cheshire, M33 3HP

It’s P11D Season! Here’s What Employers Need to Know for 2024/25

New Advisory Fuel Rates from 1 June 2025

Employment-Related Securities Returns: Deadline 6 July 2025

HMRC Spring Update 2025: Key Tax Changes for Employers and the Self-Employed