Skip to content


Fancy a cuppa and a bite to eat?

Fancy a cuppa and a bite to eat?

Chances are that your business won’t be paying, and you’re not going to like it.

Inland Revenue recently issued an Interpretation Statement (IS 21/06) on the deductibility of meals during the day and while travelling for business purposes. Inland Revenue believes this part of the legislation hasn’t been correctly followed in the past. It’s therefore not a new law, but explicit instructions on how existing law must be applied. 

Inland Revenue considers meals to be a necessity for living rather than for earning income based on business structures.

Sole traders / partnerships

  • No food or drink can be claimed as a business expense. Not even if you’re away on business, staying at a hotel overnight or many nights, or attending a conference
  • The only situation where meals/drinks can be claimed as a business expense is when you are ‘entertaining’ suppliers, wining and dining (potential) clients, holding staff functions, etc. These fall under the entertainment guidelines, where only 50% of the cost is deductible
  • There are no exceptions to the above* – it’s black and white. You’re expected to pay for meals yourself and/or take a paper-bag lunch and a thermos to work

* Well…perhaps one. The only way a sole trader or a partner can claim meals with accommodation is if there are no self-catering motels available, and no supermarkets in the area. Even then, the amount claimed can only be the difference between the actual cost and what it would cost for you to have a meal at home. Good luck working that one out!

Shareholder employees

You’re in exactly the same position as sole traders and partnerships above, with one exception – your signed employment agreement requires that your employer (the company) reimburse you for meals and drinks, or provides you with an allowance. Of course, what is an exception without strings attached?

  • The cost needs to be incurred when you’re away from your normal place of work for business purposes
  • The reimbursement must be reasonable and in line with the company’s agreements with other employees. For example – you can’t have an elaborate meal with expensive wine, while other employees are limited to a Subway sandwich

Other travelling costs

The costs of accommodation and travel to the location for business purposes continue to be deductible.


You’re likely to be thinking to yourself “But…”, “What if…?”, “What about…?” The answer is “no”.

Here are some related resources you might be interested in:

Who are Beany?

We’re an online accounting firm that is always right here for you, your accounting pain relief. The most advanced technology lets us work way more closely with you than a normal accountant would. 

We have a dedicated team of remote accountants to take care of your business no matter where you are, so you can focus on growing your business. We take out the ‘fluff’, break down the barriers and get things done. Looking out for you is what we are all about. Get started for free today.  

Tess, Problem Solver

Got any questions about Beany?

Chat to one of our friendly problem solvers today to get clarity.

Kim Jenkins

subscribe + learn

Beany Resources delivered straight to your inbox.

Beany Resources delivered straight to your inbox.


Related resources

View all resources
View all resources