disallowable expenses

While there is no Limit on expense categories, there are types of expenses that are not business, or are not reportable, and this depends on your business operations, your entity type, and the local regulations that apply.

For instance, if "hall rental" is for a wedding planner or event manager, of course these rental expenses are business related.

Car insurance might be a different consideration. For examples:

A Floral Delivery service has an exclusive business use vehicle, and it likely is owned by the business entity. Your own personal vehicle with mixed use isn't the same rules.

You should always work with your own accountant to confirm the specific operations and the data are managed properly for your tracking and reporting needs.

That is helpful thanks, but if I know the hall rent is claimable how to I adjust it so that QB accepts it rather than disallows it?

I currently have the same issue. Did you manage to find a solution?

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@KR3 wrote:

That is helpful thanks, but if I know the hall rent is claimable how to I adjust it so that QB accepts it rather than disallows it?

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i am having the same issue. Can somebody from the QB team please answer this question?

I am having the same issue. Can somebody from the QB team please answer the question?

Hello there, KR3 and HayleyPT.

Hall hire and car insurance should fall under travel expenses. This way, it will be counted as allowable expense. There are costs that you can claim as allowable expenses. This means, the limit (threshold) is set by the HMRC.

Please check thhis article as your reference: https://www.gov.uk/expenses-if-youre-self-employed.

If you have other concerns, please drop a comment below. 

Hi there,

I'm having a similar issue with proportion of utilities/rent for using my home as an office. I think it's stopped the allowable expenses at the flat rate (simplified expenses) whereas I'm calculating it fully. Is there a way to adjust QuickBooks to allow these expenses?

Thanks,

Vinay

Hello there, @VinayPatel.

Allow me to join the thread and help share information about simplified expenses in QuickBooks Self-Employed.

QuickBooks Self-Employed uses the simplified expense method to calculate a deduction for you if you perform your self-employment work from your home.

The simplified expense method uses a flat rate based on the hours you work from home each month. With this method, you don't have to calculate the business-to-personal proportion of home expenses. You can use the flat rate deduction if you work for 25 hours or more a month from your home.

If you want to claim for 'work from home' under the simplified expenses method:

1. Go to the Gear icon.
2. Select Tax Profile.
3. Enter the number of hours under Do you work from home?.

If you enter 25 or more, we automatically know the amount you can claim and record that amount in your tax report  If you want to claim the actual costs and not use the simplified method, then leave the field blank and keep categorizing your bank transactions as per normal.

You may consult your accountant if you have any other questions. You can also check the HMRC website for the current flat rate deduction amounts and examples.

You can also check these articles for additional reference:

• Simplified expenses if you're self-employed
• Self-employment

Please know that I'm always here to help you if you have any other expenses concerns, I'll be right here to help you. Have a good one!

Hi, sorry to jump on this thread - but was there an answer as to why hall hire comes under travel expense?? I'm trying to classify hall hire, washing machine usage, storage unit rental under the 'Rent/Utilites/Insurance' category, but it's all showing as disallowed? I can't put all that under travel expense? Bit confused.

Thanks for joining this thread, @Cam33. 

Allow me to share some information about the categories that are showing under travel expenses. 

QuickBooks Self-Employed uses the Simplified Expenses (with flat rates) method to calculate the allowable business expenses for your car, van, or motorcycle. The rate is based on the mileage you drive.

Using this method, you can't claim vehicle insurance, repairs and servicing, or fuel costs. You can claim all other travel expenses in addition to your simplified expense amount. 

You'll categorize a transaction as travel expense when it's your train, bus, air, and taxi fares, as well as lodging and food costs while traveling overnight. Then, car/van expense if it's vehicle expenses like insurance, repairs, servicing, fuel, and parking. For more information, see this article: About Car, Van, and Travel Expenses. 

The SA103F categories that was tagged as allowable are expenses that can be deducted from your taxable profit. However, disallowable expenses are transactions that can't be deducted from your business income. For more details, you can check out this helpful article: About SA103F Categories. 

To properly categorize your hall hire, washing machine usage, and storage unit rental, I'd suggest consulting your accountant. This way, he can confirm if these categories are under the "Rent, Utilites, Insurance" category and if these are compliant to the HMRC requirements regarding expenses if you're self-employed. 

I'll be here if you have follow-up concerns about this or should you need anything else, @Cam33. Have a good day. 

Having the same problem as Vinay. I've got my work from home hours in my tax profile set as zero and have set up a rule, apportioning a percentage of my rent to home office, but it's still saying it's disallowable. How can I change that?

Having the same problem as Vinay.

I'm not using Simplified Expenses.

In my Tax Profile I have set my work from home hours as zero.

I've set up a rule to apportion a percentage of my rent to home office expenses, yet QB is showing it as disallowable.

How do I overcome this?

Hello

QuickBooks uses simplified expenses if you have set the hours worked from home to zero in the tax profile, can we ask what proportion are you wanting to appear in allowable and disallowable and what categories are you using in this split transaction? Are you able to send us a screenshot from the transactions page of an example you have allocated this way as well as one of the taxes summary?

Thanks

Emma

Hello Emma,

I've set the rule split for my rent to be 7% business, 93% personal under Home Office expenses.

Please see attached screenshots showing the relevant info.

Please let me know what I'm doing wrong & how to fix this so the expense is allowable.

Thank you.

Hello there, @zulugirl.

Allow me to share some resources on how QuickBooks Self-Employed handles tracking and categorizing of your Home Office Expenses.

When recording your home office expenses, there's no need to split the specific transaction. What you need to do is to make sure you're able to set your Tax Profile.

As soon as you transactions are downloaded from  your bank into QuickBooks, the system will automatically calculate your allowable and disalowable expenses base on the information you entered in your Tax Profile.

Also, I'd suggest consulting with your accountant so you will be guided accurately on the next step to follow when tracking and categorizing allowable and disallowable Home Office expenses.

You can always visit us here in the Community if you have other questions about  tracking your expenses in QuickBooks Self-Employed. I'm always here to help.

I have not put I work from home,  but even if I do  Quick Books are still saying my van expenses are disallowed on self assessment summary.  I am claiming the cost of the van, fuel, insurance and tax, the van is used only used for work.  Can you help?

Thanks for joining us here, christine007.

I would recommend reaching out to our chat support for QuickBooks Self-Employed. They will help you review the transactions and help with your van expenses. Here's how:

1. Click Help in the upper-right hand corner.
2. Click Contact Us. 
3. Fill in Ask a question (or tell us what’s wrong), then select Continue.
4. Select Chat.

If you're in the UK, please go to this link to reach out to them: https://help.quickbooks.intuit.com/en_GB/contact.

Visit us again in the Community if you have other questions. 

That didn't help at all. I see my psychotherapy clients at home; I teach at home; my students stay with me when I run workshops and courses. I actually use my half my home for work with students and clients ... how do I make that happen on Q?

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@qbteachmt wrote:

While there is no Limit on expense categories, there are types of expenses that are not business, or are not reportable, and this depends on your business operations, your entity type, and the local regulations that apply.

 

For instance, if "hall rental" is for a wedding planner or event manager, of course these rental expenses are business related.

 

Car insurance might be a different consideration. For examples:

A Floral Delivery service has an exclusive business use vehicle, and it likely is owned by the business entity. Your own personal vehicle with mixed use isn't the same rules.

 

You should always work with your own accountant to confirm the specific operations and the data are managed properly for your tracking and reporting needs.

---

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@qbteachmt wrote:

While there is no Limit on expense categories, there are types of expenses that are not business, or are not reportable, and this depends on your business operations, your entity type, and the local regulations that apply.

 

For instance, if "hall rental" is for a wedding planner or event manager, of course these rental expenses are business related.

 

Car insurance might be a different consideration. For examples:

A Floral Delivery service has an exclusive business use vehicle, and it likely is owned by the business entity. Your own personal vehicle with mixed use isn't the same rules.

 

You should always work with your own accountant to confirm the specific operations and the data are managed properly for your tracking and reporting needs.

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The long and short of it would appear that quickbooks is trying to be too clever and do a little too much for those of us who are wishing to use the non simplified expenses method ie: not tracking milage but actually using our relevent vehicle expenses etc!

After reading this whole thread due to having similar issues as listed by other users, that is the conclusion which I have come to.

Hopefully I am wrong or there is a way of telling quickbooks on your account that you do not wish to use simplified expenses. If that is not the case then Im afraid I will probably be looking at going elsewhere which would be a shame as I ran quickbooks small business for 4 years while running a Ltd company and was so impressed with it I thought I would give there self employed version a try! This would seem a severe overlook by Quickbooks to try and 'force' people to use simplified expense accounting.

It would appear quickboooks is trying to be too clever and 'forcing' people to use simplified expense accounting. I will be seriously dissapointed if there is not a way to change that on your account as like many others on this thread, I do not wish to use mileage tracking etc which I have heard is not the most accurate, and would much rather enter exact values for my expenses. After reconciling a section of my accounts I then looked into my tax returns and saw that I had hardly any tax deductable allowable expenses which couldnt have been further from the reality hence why I came across this post!

I used quickbooks small business package for 3 years while running a Ltd company and was extremely impressed with it so thought I would try there self employed variant with high expectations. If what I have said above is true then I shall be looking at going elsewhere. If I am right in what I have said then I feel that this is a massive mistake on quickbooks behalf!

Hi did you manage to find a solution to this, we have 3 vans one of which is only used as a spare incase of breakdowns therefore simplified expenses does not work for us we need to report actual expenses.

Thanks Laura

Sorry, but this solution simply does not work.