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HMRC internal manual

Business Income Manual

Specific deductions: staffing costs: employee welfare

You should allow expenditure incurred directly by a trader on the welfare of their employees, unless of a capital nature. For guidance on expenditure on staff entertainment, see also BIM45033.

Admissible types of outlay include the following:

  1. The rent and cost of maintenance of recreation grounds, canteens, ambulance rooms, rest rooms, lavatories, day nurseries etc for the use of the employees.
  2. Fees etc paid in respect of the attendance at technical and educational classes of juveniles actually employed, and grants made to cover the travelling expenses of such employees between the business premises and the classes (see also BIM45155 - BIM45170 regarding payments for technical education).
  3. Salaries of welfare superintendents.
  4. Provision of overalls, caps etc and cost of repair and laundering.

Inadmissible types of outlay include the following:

  1. The cost, whether incurred voluntarily or under compulsion, of additions or structural alterations to factories etc made to meet the welfare requirements of operatives.
  2. The cost of sports pavilions, clubhouses etc or of laying out cricket etc grounds.