2 min read Self-Employed

What Expenses Can You Claim as a UK Self-Employed Person?

Understand which business expenses are allowable for self-employed people in the UK, how to claim them, and what HMRC will not accept.
What Expenses Can You Claim as a UK Self-Employed Person?

Claiming all allowable business expenses is one of the most effective ways to reduce your tax bill as a self-employed person. The basic rule is that an expense must be incurred wholly and exclusively for the purpose of your trade to qualify for a deduction.

The Golden Rule

HMRC's test is set out in s.34 of the Income Tax (Trading and Other Income) Act 2005. The expense must be wholly and exclusively for the purposes of your trade. Personal expenditure and dual-purpose costs are excluded unless they can be apportioned.

Office and Home Working

If you rent office space, the full cost is deductible. Working from home, you can claim a proportion of household costs based on rooms used and hours worked, or use HMRC's flat rates: £10/month for 25–50 hours, £18/month for 51–100 hours, £26/month for over 100 hours of business use.

Travel and Vehicles

Business travel is deductible, but not commuting. For cars, either claim the actual business proportion of all running costs, or use the simplified mileage rate: 45p per mile for the first 10,000 business miles, then 25p. Motorcycles attract 24p/mile and bicycles 20p/mile. Keep a mileage log — HMRC frequently requests this in compliance checks.

Equipment and Technology

The Annual Investment Allowance lets you deduct the full cost of most plant and machinery in the year of purchase, up to £1 million. This covers computers, tools, machinery, office furniture, and phones used for business. Only the business proportion qualifies if there is private use.

Staff and Subcontractors

Wages, salaries, employer's National Insurance contributions, pension contributions, and training costs are all deductible. Subcontractor fees are allowable — but mind IR35 and Construction Industry Scheme rules if applicable to your sector.

Professional Fees and Insurance

Accountancy fees, solicitor fees for business contracts, professional subscriptions to trade bodies, and indemnity insurance premiums are all deductible. Personal legal costs are not.

Marketing

Website costs, online advertising, print materials, and business cards are allowable. Client and customer entertainment is specifically excluded.

What You Cannot Claim

Ordinary food and drink; personal use of business assets; HMRC fines and penalties; client entertainment; depreciation (use capital allowances instead); capital expenditure through the profit and loss account.

Record-Keeping

HMRC requires records to be kept for at least 5 years after the 31 January submission deadline. Store receipts, invoices, bank statements, and mileage logs. Cloud accounting software will be essential as MTD for Income Tax is introduced from April 2026.

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