HMRC is cautious to ensure that expenses claimed as sponsorship genuinely serve business purposes, preventing misuse.
Why does HMRC tend to disallow sponsorship costs as business expenses?
Updated on 23rd October 2023
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HMRC is cautious to ensure that expenses claimed as sponsorship genuinely serve business purposes, preventing misuse.
Example: If you sponsor a sports team purely because your friends with the coach and it doesn’t relate to your business, HMRC may disallow the expense. Its important to note here than you must receive something in return for your sponsorship- therefore advertising your business on football shirts would be allowable.