BIM50160 - Actors and other entertainers: expenses
Actors, dancers etc who are engaged under standard contracts incur few expenses in the course of their work. This remains true even if the performer is dealt with under Schedule D (see BIM50151). The contracts usually require the production company to supply the costume, wigs, hairdressing and exceptional make up necessary for the role. In addition, the theatre management provides transport between theatres and rehearsing rooms and between tour venues. Payments may also be made to cover the actor's travelling between home and the theatre.
Clothing
The general rule for clothing costs is set out in
BIM37910 where the case of
Mallalieu v Drummond [1983] is discussed. In
Mallalieu, Lord Brightman explained that a
self-employed person could not claim a deduction for the cost of
‘a wardrobe of everyday clothes’ even if they were used
solely for work. There is an inevitable non-business purpose in the
acquisition of such clothing: the provision of warmth and decency.
The
Mallalieu decision does not mean that the cost of
clothing is always disallowed. BIM37910 gives examples of the costs
of a ‘uniform’ or protective clothing. The cost of
clothing acquired for a film, stage or TV performance is also
allowable. The clothing in such event is not part of ‘an
everyday wardrobe'; it is ‘costume’ used in a
performance.
Example
A self-employed television interviewer may deduct the costs of a lounge suit acquired solely for use before the cameras - it is the interviewer’s ‘costume’. By contrast, a self- employed architect who buys a suit in order to create a good impression while being interviewed on television may not have a deduction for the cost. The suit is not a self- employed performer's ‘costume’. It is 'everyday' clothing worn in the course of the architect's profession and Mallalieu v Drummond applies.
You should also allow the cost of costume and grooming (for example hairdressing and make up) incurred by a performer making ‘personal appearances’ the sole purpose of which is to promote their business activities.
Example
A film actress may acquire an evening gown solely for the purpose of attending the premiere performance of her latest film. The cost of the gown is allowable. The later private use of a gown, which as a question of fact was bought solely for use at a premiere or other such occasion, does not result in disallowance of the expenditure. But if the actress bought the gown with a view to use both at the premiere and on other private occasions, no deduction is due.
For more information about clothing expenses generally see BIM37910.
Medical expenses
Health related surgical, hospital and medical expenses are
inadmissible deductions in computing profits (see
Norman v Golder [1944] 26TC293). This will be so
even if a reason for paying for private health treatment is to
enable the performer to arrange the timing of treatment to best
suit their business commitments.
Only in exceptional circumstances will non-health related
operations to change personal appearance by reversing or masking
the advancing of the years (for example, face-lifts) not have a
private purpose. You should invite the Commissioners to infer the
existence of a private motive unless there is compelling evidence
to the contrary.
Where a performer claims a deduction for the cost of cosmetic
surgery to correct some perceived inadequacy in their appearance
then you need to examine whether one of the purposes in incurring
those costs was to gratify their private wish to improve/change
their appearance. If it was, no deduction will be due. Some
performers may, however, be able to show that expenditure on
cosmetic surgery has been incurred
solely for professional purposes. Such expenditure
may be allowed.
Example
A radio performer of many years experience starts to do TV work. She is advised that her irregular teeth are holding back her TV work. She has cosmetic dentistry to give her a perfect smile. It is established as fact that she had been content with her appearance and the TV work was the sole reason for the dentistry. The cost is allowable.
For more information see BIM37940 to BIM37950.
