I consult and lecture internationally as a sole trader. Most clients provide tickets and accommodation, so 80-90% of turnover is profit. I include outgoings and corresponding reimbursements from non-commercial work (e.g. lectures for professional societies) in my accounts; it’s simpler than keeping separate commercial / non-commercial books and prevents complications when work is a mix of commercial and non-commercial. Having partly retired from the PAYE-taxed day job I find more situations that blur the edges. Two examples:
1) Prof X invites me to his 3-day meeting in Portugal. He’ll provide hotel and meals plus Euro 200 to cover Ryanair. Work is an hour’s lecture, a session to chair and providing discussion in other sessions; not arduous. In reality I’ll fly out TAP (Euro200), explore local mountains for a few days, do the meeting, then return on the sleeper (Euro350). It’s more fun. Hotels in the mountains are clearly holiday, but how about the travel? I need to get to the meeting, so can I book Euro 550 costs vs. 200 income = 350 net loss into my accounts. Or do HMRC likely see the whole trip as a holiday?
2) A US society invites me to speak. They provide hotel and meals and $1800 for economy travel. In reality I sail on the Queen Mary 2, taking the wife, then return on frequent flier miles, paying assorted surcharges and 2 nights hotel between arrival and the meeting start. Costs are $6000 (say), half attributable to me = $3000. Company Y, knowing I’m in the US early, seeks a consult, paying $2000; Company Z, for whom I have retained consultancy wants time too. So, I’m working steadily and the trip is profitable in isolation ($800 up). HMRC would allow business class flights without demur, but will they see Cunard - cheaper - as a week’s disallowable cruise?