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Training Expenses

Monday 13th May 2013

Over the last few years many contractors have chosen to boost their chances of winning contracts by investing in themselves. Training expenses fall into two different categories for tax, those that develop your current skills and those that give you new skills - below are the details.

Training costs do have some conditions that have to be met for them to be tax deductible business expenses. Firstly they must upgrade or enhance your current skills that your company already generates income from. If the training goes further than this and teaches you completely new skills, the cost of the training will not be a business expense but instead a capital expense.

A good example would be an Engineering Contractor who takes a course in Environmental Engineering which is relevant to his current contracts and income. This would be allowable. Where as the same contractor taking a course in Business Development Management would be a new skill that the contractor was acquiring and therefore not a tax deductible business expense.

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