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I own a small business and work out of my home. Sometimes I like to work out of a coffee shop for a few hours here and there.

Can I expense the coffee that I buy at a coffee shop?

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    What is this use of "expense" as a verb?!? Commented Oct 20, 2015 at 8:51
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    @curiousdannii - it's a dictionary usage, and quite common in the U.S.
    – feetwet
    Commented Oct 20, 2015 at 14:16
  • @feetwet I'm sure it is, but I don't think I've ever heard it before. It's completely unnatural in AusEng. :) Commented Oct 20, 2015 at 14:23
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    @feetwet You would use the verb deduct instead "Can I deduct a trip to a coffee shop?" Commented Oct 20, 2015 at 22:33
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    @curiousdannii - That's also frequently used here, probably more than "expense." And, I think, makes more sense.
    – feetwet
    Commented Oct 20, 2015 at 22:54

2 Answers 2

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For U.S. companies and proprietors: No. In general you can only deduct food costs for necessary business travel, and then it is subject to either published "per diem" rates or a "50% limit".

Start your adventure reading at the IRS, Publication 463, here!

Amusingly, if you have a separate office, you can fully deduct the cost of "refreshments" (which includes coffee) in that office as a "business supply."

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    Can you expense an employee's coffee at the shop?
    – Viktor
    Commented Oct 19, 2015 at 21:29
  • @Viktor - Yes, if you are having a "business meeting" there. Same linked section of Pub 463 covers that scenario.
    – feetwet
    Commented Oct 19, 2015 at 21:56
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In Australia, you can claim the GST and a tax deduction for coffee you buy for clients, suppliers, etc. but not for owners or employees. They must either pay for it themselves or, if the company does, it is not tax deductible. Alternatively, it can be treated as a fringe benefit; fringe benefits over $100 per year per employee must have fringe benefits tax paid and are then deductible for GST and income tax.

In addition, if the employee (owner) is staying away from home overnight; they may claim meal (and accommodation, transport etc.) either at cost (subject to limits that increase with your base salary) or on a per diem rate set by the ATO based on the location.

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