BIM42135 - Measuring the profits (specific rules & practices) - receipts & deductions: deductions - scope of: incidental benefit
No bar to deduction
An expense may necessarily involve a benefit to a third party (see Usher's Wiltshire Brewery Ltd v Bruce, 6TC399 - see BIM37200) or to the trader in his or her own personal capacity. It is not disallowable under ITTOIA05/S34(1)(a) or CTA09/S54(1)(a) because of the incidental benefit or result provided that it was not part of the purpose in incurring the expense to secure that benefit.
The problem is to distinguish an incidental or unsought benefit, or the furtherance of some non-business objective, from the purpose of the expenditure. The possibility that an ‘incidental benefit’ may accrue means that wholly and exclusively questions cannot be decided by reference only to the effect that resulted from the payment. All the facts and evidence should be ascertained from which the purpose of the trader may be inferred (see Bentleys Stokes & Lowless v Beeson, 33TC491 - see BIM37400).