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bigduckontax
bigduckontax, Accountant
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Is it correct that training costs to BECOME a Yoga teacher

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Is it correct that training costs to BECOME a Yoga teacher (ie before trading commences) are not allowable either as a revenue expense OR a capital expense (for capital allowances purposes) and are, in effect of no tax benefit at all. I would be interested in, and grateful for your thoughts - thanks - Tim
JA: Have you talked to a tax professional about this?
Customer: I am an adviser, but cannot locate a definitive reference that disallows the use of the capital cost for capital allowances purposes - ie if I purchased a special piece of yoga kit, a mat or bench etc, that would have enduring value to the business and in principle, would be written off over the life of that capital item - the cost of the training, would have an enduring value to the business and on the basis of reasonableness, contribute towards the income of the business as do the other more tangible assets and should therefore be allowed to be written off, for tax purposes, over the life of the business - hence my question - thanks - Tim
JA: Which tax year is this for?
Customer: I am an adviser, but cannot locate a definitive reference that disallows the use of the capital cost for capital allowances purposes - ie if I purchased a special piece of yoga kit, a mat or bench etc, that would have enduring value to the business and in principle, would be written off over the life of that capital item - the cost of the training, would have an enduring value to the business and on the basis of reasonableness, contribute towards the income of the business as do the other more tangible assets and should therefore be allowed to be written off, for tax purposes, over the life of the business - hence my question - thanks - Tim
JA: Anything else you want the Accountant to know before I connect you?
Customer: I am an adviser, but cannot locate a definitive reference that disallows the use of the capital cost for capital allowances purposes - ie if I purchased a special piece of yoga kit, a mat or bench etc, that would have enduring value to the business and in principle, would be written off over the life of that capital item - the cost of the training, would have an enduring value to the business and on the basis of reasonableness, contribute towards the income of the business as do the other more tangible assets and should therefore be allowed to be written off, for tax purposes, over the life of the business - hence my question - thanks - Tim
Customer: I am an adviser, but cannot locate a definitive reference that disallows the use of the capital cost for capital allowances purposes - ie if I purchased a special piece of yoga kit, a mat or bench etc, that would have enduring value to the business and in principle, would be written off over the life of that capital item - the cost of the training, would have an enduring value to the business and on the basis of reasonableness, contribute towards the income of the business as do the other more tangible assets and should therefore be allowed to be written off, for tax purposes, over the life of the business - hence my question - thanks - Tim
bigduckontax

Hello Tim, I am one of the experts on Just Answer and pleased to be able to help you with your question.

Allowable training costs are those to enhance existing qualifications, not gain new ones, so you are correct in your surmise.

A bit of yoga kit would be a capital item and written off at 100% as an AIA in the year of purchase. Although training is of value to the business its use as an expense is limited as I explained earlier. Don't blame me, I did not write the rules!

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Customer: replied 1 year ago.
Many thanks - do you have the HMRC guideline/statutory reference for this? Thanks - Tim

It has been around since time immemorial, Tim!

HMRC are surprisingly opaque on the matter. However, her is the guidance from Nelsons:

'Where training is paid for by the employer, the tax situation is different. On the whole, training which enables employees to better do their jobs will be allowable. This even includes general training, which may not have an immediate impact on their work.'

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Customer: replied 1 year ago.
Thanks
Customer: replied 1 year ago.
Nelsons also show this which is confusing - "However, whether the training is an ‘investment’ or an ‘expense’ must be considered. If it is an investment, such as learning how to develop new products, technically this is a capital item and capital allowances tax relief should be claimed" if I say I am training myself to develop a type of teaching and that type of teaching is Yoga? I appreciate a long shot and I concur with your assessment - Thanks - Tim

As I said you can only try, it might be accepted.

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