What expenses can I claim as a Sex Worker?

The key rule to remember for all business expenses is the rule "wholly, necessary and exclusively". This rule can get confusing in Sex Worker world. Clients make specific requests for online content creators, want escorts is particular outfits, their Domme in a certain coloured wig.

Here are some examples of questions I've been asked to hopefully show the differences.

A client wanting a certain coloured wig for a session.

This would be an allowable business expense.

Why? Its unlikely to be used by you personally. If HMRC asked you could show its been specifically requested. Its equipment for your business and its likely you'll use it again within the business.

A client wanting your nails done for a session.

This would not be an allowable business expense.

Why? You get personal benefit from having your nails done. You might not agree but that's HMRC's view. Your nails will be on for a couple of weeks, during work hours and personal hours. There's clear personal use so HMRC say no.

You need to book a hotel room to meet a client.

This would be an allowable business expense.

Why? There's a clear business reason for booking the hotel room. Its no different to renting an office space for the day.

If your client repays you to cover for the cost of the room make sure to include that payment in your income, and then cost of you paying for the room would be an expense to balance it out.

A client wanting you in a little black dress for a meet.

This would not be an allowable business expense.

Why? With a LBD its very hard to make the argument that you would not get personal use from the dress. Suits aren't allowable business expenses, neither are pretty dresses.

You need new thigh high latex boots.

This would be an allowable business expense.

Why? Thigh high latex boots are unlikely to be worn in your personal life. These are more of a "costume" element. Ballet shoes would be allowed for a professional ballet dancer.

The important thing to remember is HMRC don't care how clever you think your logic argument is that means the purchase wont have personal benefit. If they decide it does, they win, so I always recommend airing on the side of caution.

Be sensible and reasonable about what you are calling business expenses. As a Dominatrix its likely a lot more of your purchases would be allowed compared to an escort because of the costume element of the outfits. You're unlikely to wear a latex body suit to the supermarket, you could wear a dress and heels.

What does an allowable expense mean?

You pay tax based on your profit. You work out your profit based on your income minus your expenses. An allowable expense means its a purchase that will be taken off your income to lower your profit and therefore mean you pay less tax.

This doesn't mean its worth just buying everything possible through your business card. Spending money just to lower your tax bill just means you have less money.

What else?

Remember all the small basic things. Keep a mileage log if you driving to meetings, train tickets to meetings, stationery, computer software, any kit used for your business, accounting fees, renting spaces. All these are business expenses. Don't spend money and miss out on the tax relief!

If you need help working out if something is a business expense or not, send us a message and we'll be happy to help.