If a business owner or a key person to the business were to fall ill they might struggle to keep an income from the business coming in. It is always wise, therefore, to pay for private health cover to mitigate any waiting times to see specialists, which can mean earners are back up and running sooner. Illness can have an enormous impact on profits and overall success within a business and it is for this reason that owners can legitimately treat healthcare costs as a business essential and therefore treat it as a business expense.
Most businesses require standard insurance policies to be in place to protect their business should something go wrong, and these all fall under the category of insurances that can be treated as a business expense. Insurance policies such as public liability insurance from Kingsbridge UK which protects businesses should anything happen to a member of the public while they were interacting with a business or professional indemnity insurance which covers businesses against claims of inadequate services or products can all be expensed. Simply put, any insurance which protects the business can all be paid for by the business.
Travel or Household Insurances
For those who work from home or drive their own car as part of their business, it is possible to recover some of their insurance costs from the profits of their business. For instance, those driving their own car are entitled to claim back a proportion of their car insurance for the times where they are driving the car for business purposes. In order to this, it is wise to keep a log of business mileage over a representative period and use this to work out the proportion of the time that the car is used for business purposes and then work out the cost element for this. Those who work from home can also claim back a proportion for home insurance. The amount claimable should be calculated based on the proportion of the household that is used to run the business and is normally calculated based on the number of rooms used for business operation compared to the total number of rooms in the house.
Key Person Insurance
This is an extremely useful insurance policy for any business to have in place and it is completely legitimate to claim back the cost of it from profits. This insurance means that a business can protect itself from a loss in profits following the death of a key member of the business. Business owners should always talk to a professional advisor, however, before setting up this type of insurance policy as without prior thought and care a payout could leave recipients facing a hefty tax bill.