If you’re self-employed, there are a number of expenses you claim (depending on your occupation). Claiming expenses will reduce the amount of tax you pay.
There are two main ways in which you’ll be able to claim your self-employed expenses.
The first way is to simply claim a flat £1,000 as a self-employed Trading Allowance. Self-employed earnings up to £1,000 are generally not taxable profit.
⚠️ If you choose this to claim this allowance, you won’t be able to claim any other expenses or allowances. ⚠️
If your total expenses are over £1,000 per tax year, it’ll probably make more sense to claim business expenses to cover your business costs. If you claim business expenses, you won’t be able to claim the Trading Allowance.
For this, don’t forget to keep an in depth record of them, along with all your business receipts. Bank statements can sometimes work instead, but it’s best to stay on the safe side!You claim on your Self Assessment tax return, so make sure you register for it with HMRCif this is your first one.
|Type of expense||Can I claim it?||How much can I claim?|
|Home rent||Yes||Either claim the percentage that you use your home for work, or a flat home office allowance|
|Home insurance||Yes||Same as for home rent|
|Home utilities (electric bill, phone bill, etc.)||Yes||Same as for home rent|
|Home repairs||Yes||Same as for home rent|
|Home mortgage payments||Not really||Only a part of the interest on mortgage – similar to how you claim rent. You’re probably better off using the flat home office allowance|
|Laptop for work||Yes||100%|
|Phone for work||Yes||100%|
|Antivirus, Office software||Yes||100%|
|Paper and pens for work||Yes||100%|
|Protective gear for construction work||Only if your contractor is not already providing you with it||100%|
|Special uniforms||Only if your contractor is not already providing you with it||100%|
|Car insurance||Yes||Use the percentage that you use your car for work. Keep the invoice. Or just use the flat mileage allowance|
|Fuel||Yes||Use the percentage that you use your car for work. Keep the invoice. Or just use the flat mileage allowance|
|Parking fees||Yes||Use the percentage that you use your car for work. Keep the invoice. Or just use the flat mileage allowance|
|Taxi fares||Yes||Only trips for work – keep the receipts|
|Travel from home to regular workplace||No||—|
|Hiring other people (subcontracting work)||Yes||100%|
|Buying goods for resale (e.g. on eBay)||Yes||100%|
|Buying raw goods for production (e.g. you’re making and selling hats on Etsy)||Yes||100%|
|Bank, overdraft, and credit card fees||Yes||If you’re using cash basis then you can only claim up to £500. Otherwise 100%|
|Interest on loans||Only if they are for work||100%|
|Leasing payments||Only if they are for work||100%|
|Business insurance||Only if it’s for work||100%|
|Bad customers||Only if you’re using traditional accounting||100%|
|Advertising (newspapers, local Google Ads, etc.)||Yes||100%|
|Website development, hosting, domain name, etc.||Yes||100%|
|Meals with clients or suppliers||Yes||100%|
|Drinks with clients or suppliers||No||—|
This depends on a range of factors. You may be able to claim this as a capital allowance, but the general rule is that you can claim back costs as long as you can prove it was spent for business purposes.
Mileage can be a tricky one as you may be covered when making your way to and from your business premises or even overnight business trips – but won’t be covered for any personal stops in between.
Give our Mileage Allowance calculator a go to work out what you may be able to claim!
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