Self Employed .. What Can I Claim As Expenses?


If you're self-employed, you will have various running costs. Some of these expenses you can deduct on your tax return as allowable expenses.

Allowable expenses do not include money taken from your business to pay for any private purchases.

If you run your own limited company then the rules for expenses and business costs are worked out differently, below is a list outlining the allowable expenses and capital allowances you can claim back.

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Expenses that you can claim

Capital allowances you can claim

If you use the traditional accounting method you can claim capital allowances when you buy something you keep to use in your business.

  • equipment
  • machinery
  • business vehicles, for example cars, vans, lorries

If you use the cash basis accounting method and purchase a car for business use, you can claim this as a capital allowance. However, all other items should be claimed as allowable expenses as outine above.

If something is used for both business and personal reasons

You can only claim allowable expenses against the use for business costs.

Example: Your mobile phone bill for the year totals £200. Of this £ 70 is for business calls only. You can therefore claim £70 for business expenses.

If you work from home

You may be able to claim part of the costs for any of the below as business costs:

  • heating
  • electricity
  • Council Tax
  • mortgage interest or rent
  • internet and telephone use

A reasonable method for dividing the costs for business use in the home will need to be used, for example by the number of rooms used for business or the amount of time you spend working from home.

Simplified Expenses

You can avoid complex calculations for working out your business expenses by using  simplified expenses. This is where a flat rate can be used for:

  • vehicles
  • working from home
  • living on your business premises



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