Avoid Horror Story Tax Affairs: The Scariest Expense Mistakes Contractors Make

Halloween is the season for tricks and treats — but when it comes to your tax return, tricks can lead to real financial frights. From “business” trips to Vegas to office “upgrades” that look suspiciously like home makeovers, we’ve seen it all. So before you submit your next expense claim, take a moment to make sure you’re not entering a horror story and stay stress free.

The Vegas “Work” Trip

A few days in Las Vegas might sound like the perfect “networking” opportunity, but unless your trip was wholly, exclusively, and necessarily related to your contract, it won’t qualify as a business expense. Revenue looks for clear justification — meetings, conferences, or client-related travel with evidence to match. Travel that is primarily for leisure — even if you did attend with the second director, will not qualify as a business expense.

The Michelin-Star Client Dinner

We all want to make a good impression, but Revenue won’t be impressed with your five-course tasting menu. Entertaining clients — whether it’s at a Michelin-starred restaurant, a concert, or shows, remains non-allowable. While relationships matter, these costs are considered personal rather than “wholly, exclusively, and necessarily” business-related.

The “Second Monitor”

You might consider the 75” 4K Ultra HD TV might as a “second monitor,” but Revenue won’t buy it. If a screen is purchased for genuine work purposes, it needs to be justifiable. Anything designed primarily for entertainment purposes is a definite no. Keep it practical, not cinematic.

The Home “Upgrade”

A proper home office setup can be allowable — desks, chairs, and necessary equipment are fair game. But once you start adding new appliances, wine coolers, or designer décor, you’re crossing into non-allowable territory. Personal home upgrades, no matter how stylish, don’t qualify as business expenses.

The Golf Clubs “for Networking”

We agree, golf can be great for networking. Golf clubs or golf trips are a regular feature on attempted expense lists. While it’s true that golf can be a great way to network, Revenue has a strict rule: expenses must be wholly, exclusively, and necessarily incurred in the course of business. Networking on the green sadly doesn’t meet this requirement.

The Client Coffee Run

Buying coffees for the office might make you popular, but it’s not a business necessity.
The rule of thumb: if an expense is more about social goodwill than contractual need, it won’t pass Revenue’s test.

When it comes to expenses, the golden rule is simple: they must be wholly, exclusively, and necessarily incurred in the course of your work as a contractor. If you’re ever unsure whether something qualifies — ask before you claim. At Icon Accounting, we help contractors keep their claims compliant, stress-free, and far from frightening.

So this Halloween, skip the financial fright — and let us help you keep your tax affairs horror-free.