Subsistence expenses for sole traders: meals, hotels and what you can claim

As a sole trader, you may have to pay for extra food or accommodation costs while travelling for work.

This could include buying lunch during a client visit or paying for a hotel if you need to stay overnight for work.

Whether these costs can be claimed as business expenses depends on the circumstances.

HMRC refers to these costs as subsistence. In some situations, they are allowable. In other words, they are treated as normal personal spending.

The key rule is that an expense must be incurred wholly and exclusively for the purposes of the trade.

If the cost exists regardless of the business activity, it normally cannot be deducted.

This is why food and drink expenses often cause confusion. Everyone needs to eat, whether they are working or not.

What counts as subsistence?

Subsistence usually refers to meals, drinks, and accommodation incurred during business travel.

But HMRC does not allow food costs simply because someone is working.

“The cost of food and drink consumed, and accommodation used, by a trader is not in general an expense incurred wholly and exclusively for the purposes of the trade.”
— HMRC BIM47705

So an ordinary lunch while working from home will not qualify. Neither will coffee bought during a normal working day.

What matters is whether the cost arose because of a business journey.

When can you claim subsistence expenses?

A claim for subsistence costs is usually allowable when the expense is directly linked to work-related travel.

• You are away from your normal working location
• The journey is an occasional one rather than a regular trip
• You had to buy food or stay overnight in order to carry out the work
• The costs are reasonable

“A deduction is… allowable for reasonable expenses on food and drink… if the trader does not travel to the place more than occasionally.”
— HMRC BIM47705

Claims for overnight accommodation are also allowed when genuinely required by your work.

“Hotel accommodation and reasonable costs of overnight subsistence… where a business trip by a trader necessitates one or more nights away from home.”

A train journey to another city for a meeting, with lunch during the day, would normally qualify. An overnight stay for a conference would usually qualify as well, provided the costs are reasonable.

Common subsistence examples

Working patterns can trip people up

Some jobs naturally involve moving between sites – builders, consultants and engineers, for instance, might work somewhere different every week.

Where that’s just the normal pattern, HMRC tends to see the travel as routine, which makes it harder to claim meals along the way as subsistence.

Things are more straightforward when the journey is a one-off. If you only visit a location occasionally, it’s worth keeping a brief note of why you went in case you ever need to justify the expense.

What about overnight stays?

If you need to stay away from home due to work, you can usually claim the associated costs.

• Hotel or B&B accommodation
• Dinner during the stay
• Breakfast the following morning
• Light refreshments while travelling

The costs should still be reasonable. A typical hotel and an ordinary evening meal are unlikely to cause any issues, but unusually high spending could attract HMRC’s attention.

Keeping records

You should always keep receipts to support any subsistence claims you make.

• Keep the receipt or a digital copy
• Record the date and location
• Note the reason for the trip

If you use accounting software such as Xero, categorise the expense under travel or subsistence. If you use a spreadsheet, add a short note to describe the reasons for the business journey.

HMRC benchmark meal rates

HMRC publishes standard meal allowances, known as scale rates, which let businesses claim fixed amounts instead of tracking every receipt.

These are mainly designed for employers reimbursing staff, though, so sole traders who want to use them need to get HMRC’s approval first.

As a result, most people don’t bother and just claim their actual costs instead.

A simple rule of thumb

Subsistence is generally fine to claim when the cost only arises because of a business journey.

The key question to ask yourself is: would you have spent the money if you weren’t travelling for work?

If the answer is no, and you have the receipt, it will usually pass HMRC’s rules.

If you’re unsure whether something qualifies as a business expense, it’s worth checking with your accountant first.