11 March 2025
What expenses can I claim as self-employed in the UK?
5 minutes
Work for yourself? Trying to get your head around an upcoming tax return? You might find yourself wondering, “What expenses can I claim as self-employed?” Your business inevitably has some running costs. As long as these are considered allowable expenses by HMRC, you can deduct them from your total revenue, reduce your taxable profit, and lower your tax bill.
Here, we explore the in and outs of allowable expenses for self-employed by providing a sole trader expenses list, and offering some practical advice on how to claim for these expenses.
Let’s dive in.
What can you put down as expenses for self-employed?
So, what exactly can you claim as a business expense? If you’re spending money that is what HMRC calls “wholly and exclusively” for your business, it’s likely to be tax deductible. The rules get a little murkier if the expense is also something you use for personal reasons, but we’ll explore that more in a minute.
Here are the key expenses you can typically claim according to HMRC. In each instance, we’ve included a link to the HMRC page that goes into each category in a little more detail:
- Office, property, and equipment: This category includes expenses like stationery, rent, rates, power, and insurance. Equipment that you use in your business, like computers or printers, is claimed as an allowable expense if you use cash basis accounting and as a capital allowance if you use traditional accounting.
- Car, van, and travel: When it comes to travel, you can claim for fuel, vehicle and insurance costs if you use your car for business, and for expenses like public transport fares, hotel accommodation for business trips, hire charges, and parking fees.
- Clothing expenses: If your business requires you or your employees to wear particular clothing, like uniforms or protective items, you can claim this as a clothing expense. This category also includes costumes for actors or entertainers. However, everyday clothing isn’t included, and you can’t claim it as a business expense, even if you wear it to work.
- Staff expenses: Staff costs include employee and staff salaries, bonuses, pensions, benefits, agency fees, subcontractors, employer’s National Insurance, and training courses related to your business. If you hire carers or domestic help, you can’t claim this as a business expense, unfortunately.
- Reselling goods: This category allows you to claim allowable business expenses for goods for resale, raw materials, and direct costs from producing goods. It doesn’t include any goods or materials you buy to use in a personal capacity, or the depreciation of equipment.
- Legal and financial costs: Legal and financial costs include accountancy, legal, and other professional fees, as well as bank, credit card, other financial charges, and insurance policies. These are all tax-deductable expenses.
- Marketing, entertainment and subscriptions: In terms of this category, you can claim allowable business expenses for advertising in newspapers or directories, bulk mail advertising, free samples, and website costs. You can’t, however, claim for entertaining your clients, suppliers, and customers, or for event hospitality.
- Training courses: Investing in your skills is tax deductible when it’s relevant to your business. This means you can claim for training that helps you improve the skills and knowledge you currently use for your business, stay up to date with technology in your industry, or develop new skills related to changes in your field.
Can I claim for expenses used for both business and personal reasons?
The short answer is yes, you can claim for certain expenses that you use for both business and personal reasons, but you’ll need to be careful about how you work out the business portion. Let’s look at some common examples:
- Your mobile phone: If you use your mobile for both business and personal calls, you can claim the percentage you use for business as a tax-deductable expense. For instance, if 60% of your calls are for business, you can claim 60% of your bill. Keep a record of your usage patterns to show to HMRC how you make these calculations.
- Home internet: Similarly, you’ll need to calculate a reasonable estimate of how much of your internet use is for business purposes. If you work from home full time, you might justify claiming a higher percentage than someone who works on site and only occasionally checks work emails at home.
- Your car: When it comes to your car, you have two options. You can either calculate the exact business percentage of all your vehicle costs, or you can use HMRC’s simplified mileage rates and only claim for business journeys.
HMRC understands that some items will have mixed use, but they expect you to be realistic in your calculations, to hang onto all relevant records, and to be prepared to justify your estimates if they ask you to do so.
What expenses are allowed without receipts for HMRC?
While HMRC prefers you to keep receipts for everything, they do understand that sometimes this isn’t practical. Here’s what you can claim without detailed receipts:
Simplified vehicle expenses
Instead of keeping track of every fuel receipt and repair bill, you can use HMRC’s simplified vehicle expenses (also known as mileage allowance). The rates are:
- 45p per mile for cars and vans (up to 10,000 miles)
- 25p per mile after 10,000 miles
- 24p per mile for motorcycles
Working from home
HMRC offers simplified flat rates for home working, which don’t require receipts:
- £10 per month if you work 25 to 50 hours from home per month
- £18 per month if you work 51 to 100 hours from home
- £26 per month if you work more than 100 hours from home
However, for everything else, you should really hang onto your receipts. There’s no legal requirement to keep paper receipts (digital copies are fine), but you do need to keep some form of evidence for your expenses. This could include:
- Bank statements
- Credit card statements
- Digital receipts or emails
- Purchase orders
- Contracts or agreements
Depending on the accounting software you use, you might be able to store these documents within your chosen solution.
Remember, HMRC can ask to see records going back up to six years, so it’s worth developing good record-keeping habits early on.
How do you claim for self-employed expenses?
Claiming your business expenses doesn’t need to be complicated. Here’s a straightforward guide to getting it right:
Through your Self-Assessment tax return
The main way to claim your expenses is through your annual Self-Assessment tax return. You’ll need to:
- Keep records of your business income and expenses throughout the year
- Complete your Self-Assessment by 31 January after the tax year ends
- Report your total expenses in the self-employment section
- Break down your expenses into HMRC’s categories (like office costs, travel, etc.)
If you’re confused, you might find it useful to ask an accountant to help you. They’ll ensure that you’re filling in all your details correctly, and that you’re claiming as much tax back as possible.
Using traditional accounting
If you use traditional accounting (which involves recording income and expenses by the date you invoiced or were billed), you need to:
- Add up all allowable expenses for the tax year
- Deduct these from your income to work out your taxable profit
- Report the totals in your Self-Assessment
On a cash basis
For smaller businesses with an annual income up to £150,000, cash basis accounting can be simpler. In this instance:
- Only record income when you receive money
- Only record expenses when you pay bills
- Report transactions exactly as they appear in your bank account
Whichever process you decide, always run your business affairs through a dedicated business bank account and use an effective accounting tool to help you.
Quickfire summary: When it comes to claiming for expenses, what am I entitled to if I’m self-employed?
As a self-employed person in the UK, you’re entitled to claim a wide range of business expenses that can significantly reduce your tax bill.
The most important rule is that you can claim any expense that is “wholly and exclusively” for business purposes. This covers everything from office supplies and equipment costs to travel expenses and professional training. For items that you use for both business and personal reasons, you can claim the business portion, but you’ll need to calculate this fairly and keep clear records of how you determined the split.
HMRC requires you to keep receipts and records for six years, and while digital copies are acceptable, using a separate business bank account and accounting software can make tracking your expenses much simpler. If you’re ever unsure about specific claims, it’s worth seeking professional advice, as getting it wrong could lead to problems with HMRC down the line.
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