With flexible working now the norm for many sole traders and freelancers, it’s common to split your time between home and a local café. Whether you’re catching up on emails, preparing a proposal or holding an informal meeting, working from a coffee shop can be a practical change of environment.
One of the questions we’re frequently asked at Digital Accounting is:
“If I work from a café for a few hours, can I claim my coffee as a business expense?”
It’s a fair and important question. In this article, we explain how HMRC approaches this type of expense and what that means for you as a business owner.
The “Wholly and Exclusively” Rule
For an expense to be tax deductible under UK tax rules, it must be incurred “wholly and exclusively” for the purpose of your trade.
HMRC’s position on food and drink is clear. As everyone needs to eat and drink regardless of whether they are working, these costs are considered to have a dual purpose- both personal and business. Because of this, they generally fail the “wholly and exclusively” test for UK tax purposes.
In practical terms, your regular coffee while working locally will usually be treated as a personal expense rather than an allowable business deduction.
Does Buying a Drink Count as Paying for Workspace?
Some business owners assume that purchasing a drink is effectively paying for use of the space, similar to desk hire or rent. However, HMRC does not treat it this way.
Unless you are paying a specific, invoiced fee to hire a meeting room or desk at a co-working space, the cost of the beverage itself remains a personal expense rather than a deductible business cost.
Internal Meetings vs. Client Meetings
The rules vary slightly depending on the situation:
- Buying a coffee for yourself while working locally:
Generally not allowable (personal expense). - Buying coffee for a client or prospective client:
This is classed asbusiness entertainment, which is not tax deductible for UK tax purposes. - Coffee while travelling for business:
If you are travelling away from your normal place of work for a genuine business trip, reasonable subsistence costs may be allowable. - Hiring a meeting room or desk space:
Yes- if you are charged a formal fee for room hire or workspace, this is typically allowable as a business expense.
A More Effective Way to Reduce Your Tax Bill
While coffees aren’t typically claimable, there are more meaningful and compliant ways to reduce your tax liability.
For many of our home-based clients, claiming Use of Home as Office is far more beneficial. You can either:
- Use HMRC’s simplified flat rate method, or
- Calculate a proportion of your actual household running costs.
In most cases, this results in a much more substantial and robust tax saving than small day-to-day purchases.
The Bottom Line
Working from a café can be productive and convenient, but from a tax perspective, regular food and drink costs are usually treated as personal.
If you’re unsure what you can and cannot claim, it’s always better to check. Getting it right ensures you stay compliant while making the most of the allowances available to you.
At Digital Accounting, we provide clear, practical advice tailored to sole traders, freelancers and small business owners. If you’d like guidance on allowable expenses or proactive tax planning, we’re here to help.
