There are so many allowable expenses you can claim to legitimately reduce the amount of tax you pay. We’ve rounded up 12 Self Assessment expenses you may be unaware of.
Running your own business isn’t always easy – especially concerning accounting. As a business owner, you’ll have a range of reporting regulations and requirements to fulfil for HMRC and Companies House on behalf of your company. But what some aspiring entrepreneurs may not realise is that, when you start your own business, you also need to register for Self Assessment.
Self-employed sole traders, limited company directors, shareholders, and LLP members are all required to send Self-Assessment tax returns to HMRC every year. Based on their earnings, most individuals will need to pay Income Tax and National Insurance contributions on their taxable income.
The amount you owe will vary dramatically, depending on how much profit you made the previous tax year. Fortunately, you’re allowed to deduct the cost of some of these business expenses from your profit, thus reducing the amount of tax you owe through Self Assessment.
To help you save money, look at our list of Self Assessment expenses you can claim against your tax bill.
1. Office supplies
If you’re having trouble finding business expenses to claim on your Self Assessment return, you don’t have to look any further than your desk.
HMRC will allow you to claim a range of expenses pertaining to office supplies, including:
- Your desk phone
- Your mobile phone
- A fax machine
- Postage costs
- Business stationery
- Printing costs
- Printer ink and cartridges
- Any computer software that your business has used for less than two years
- Any computer software your business uses and makes regular payments to renew the licence
You can even claim for your laptop, tablet, or home computer – but only insofar as it’s used for business. That means if you have purchased a family computer in the previous tax year that you’re only using for business 50% of the time, you can only claim the cost of that computer as a business expense on a pro-rata basis.
For some bigger items, like computers and expensive software, you may need to claim these expenses as capital allowances.
2. Donations to a charity
Did you give money to charity last year? If so, you should claim those donations as Self Assessment expenses on your tax return.
All donations made by individuals to registered charities or community amateur sports clubs (CASCs) are 100% tax-free. This is called tax relief, and how it works depends upon how you choose to donate funds.
Typically, charitable donations are either made in one or more fo the following ways:
- Gift Aid
- Directly from your wages or pension through a Payroll Giving scheme
- Land, property or shares
- Your will
With Gift Aid, charities and CASCs can reclaim the basic rate of Income Tax (20%) on your donations. For example, if you donate £1,000 to a registered charity, they can claim an extra £250, making your total donation £1,250 at no additional cost to you.
Furthermore, if you’re a higher-rate taxpayer, you can reclaim the difference between the 20% basic rate and 40% higher rate of Income Tax. Using the same example above would mean you could reduce your Self Assessement tax bill by £250.
Charitable tax relief rules apply to individuals, sole traders and partnerships. Different rules apply to donations made through a limited company.
You must keep a record of your donations if you want to claim tax relief against your total taxable income.
3. Mileage costs
Do you travel for business? You should claim a mileage allowance on your Self-Assessment return.
If you drive a car or van for work, you can use simplified expenses to claim 45p off your tax bill for every mile travelled up to 10,000 miles. After that, the amount you can claim is reduced to 25p.
For example, if you drove 11,000 business miles last year, you can claim £4,500 in Self Assessment expenses for your first 10,000 miles, and £250 for the other 1,000 miles – leaving you with the ability to claim £4,750.
Motorcycles are slightly less, at a flat rate of 24p per mile when using simplified expenses. You can also claim 20p per business mile for bicycles.
While you’re thinking about mileage permitted, it’s also worth looking at the other travel expenses you can claim on your Self Assessment return.
Allowable business expenses include:
- Vehicle insurance
- Repairs and servicing
- Fuel
- Parking
- Hire charges
- Vehicle licence fees
- Breakdown cover
- Train, bus, air, and taxi fares
- Hotel rooms
- Meals on overnight business trips
That being said, it’s worth noting you cannot claim for non-business driving or travel costs, fines you incur while driving, or any travel between your home and your regular place of work.
4. Legal and financial costs
When calculating your Self Assessment expenses, you should also include any costs associated with hiring an accountant, solicitor, surveyor, architect, or any other professional you’ve paid to assist you.
Likewise, you can claim costs for professional indemnity insurance premiums and a range of other bank and insurance costs. Allowable expenses include:
- Bank, overdraft and credit card charges
- Interest on bank and business loans
- Hire purchase interest
- Leasing payments
- Alternative finance payments, such as Islamic finance
If you use cash basis accounting, be aware that you can only claim up to £500 in interest and bank charges on your Self Assessment form.
If you use accrual (traditional) accounting, you’re not allowed to claim any legal costs associated with buying property or machinery, although if you use traditional accounting, you can claim them as capital allowances instead.
Similar to travel expenses, you are also not permitted to claim any legal or financial costs you’ve been forced to incur as a result of breaking the law.
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5. Unpaid invoices
This is one of the most beneficial (and unused) Self Assessment expenses you should claim as a business owner. If you are using traditional accounting, HMRC allows you to claim for any amount of money included in your turnover that you won’t receive.
This is known as a “bad debt”, and the only real prerequisite for including it in your expenses is that you must be sure that these invoice payments will never be recovered from a customer in the future.
You aren’t allowed to claim for any unpaid debts that:
- Are not included in your turnover
- Are related to the disposal of fixed assets, such as land, buildings, or machinery
- Are not properly calculated
It’s also worth noting that bad debts cannot be claimed on your Self Assessment form if you’re using cash basis accounting. This is because you’ve not received the money from your debtors and because cash basis accounting only records income on your return that you’ve actually received.
6. Marketing costs
Another Self Assessment expense that business owners often forget to claim is the cost of marketing their business.
HMRC will allow you to claim business expenses for:
- Any advertising you’ve done in newspapers or directories
- Bulk mail advertising (or “mailshots”)
- Any costs associated with free samples you’ve produced and distributed
- Website hosting and maintenance costs
Yet again, there are a few exceptions to the rule. You are not permitted to claim for costs relating to event hospitality or entertaining clients, customers, and suppliers.
7. Clothes
You’re not allowed to claim the contents of your entire wardrobe as an allowable expense, but there are certain items of clothing you can claim to reduce your Self Assessment tax bill at the end of each financial year.
Permitted clothing expenses include:
- Work-related uniforms
- Protective clothing needed for your work
- Costumes for actors or entertainers
Unlike travel expenses, you can deduct the entire cost of work-related clothing from your profits on your annual tax bill.
Unfortunately, you can’t claim for everyday outfits you wear to work. To qualify as a business expense, they must be necessary, work-specific clothing items.
8. Staff costs
If you employ permanent workers, seasonal employees, or contractors to help you run your business, you can claim a wide range of expenses associated with their employment when filing your Self Assessment return, including:
- Employee and staff salaries
- Bonuses
- Pensions
- Benefits
- Agency fees
- Subcontractors
- Employer’s National Insurance
- Business-related training courses
There are a couple of staff costs that HMRC does not view as permitted business expenses. For example, you cannot claim costs associated with a nanny or childminder as an expense.
9. Subscriptions
Are you subscribed to any professional bodies or trade publications that directly feed into your job? If so, you can claim those subscriptions’ costs as Self Assessment expenses.
Permitted expenses include a subscription to any trade, professional or academic journals. Likewise, a subscription or annual membership of a professional organisation or a union will also apply as a permitted expense.
- How to register for Self Assessment
- How to reduce your Self Assessment payments on account
- Do I need an accountant to do my Self Assessment tax return?
- The top 10 Self Assessment tax return mistakes – and how to avoid them
Please note that any payments you make to a political party are not claimable subscriptions. Likewise, you can’t claim personal subscription expenses like a gym membership or a glossy magazine.
It’s also worth noting that you should not claim donations you’ve made to a charity as a subscription – even if you’re donating on a subscriber-level membership. These expenses can be tallied up as charitable donations, which have their own set of rules.
10. Your mortgage and utilities
If you work from home, you’ve got a whole range of Self Assessment expenses you should be claiming – although, just like your family computer, there are a couple of crucial caveats you need to bear in mind when claiming home expenses.
You can claim a proportion of your gas, electric, water, broadband and telephone bills as allowable expenses when working from home. However, you must calculate how much each bill applies to your business.
For example, if you work from a five-room house (kitchens and bathrooms do not count as ‘rooms’), and one room is used exclusively for business purposes, you can claim 20% of your annual bills as Self Assessment expenses on your tax return. The same rules apply to your mortgage interest (but not capital repayments) or annual rent costs.
If the room serves another purpose (e.g., a spare bedroom) or you only work from home one day a week, you need to apportion the costs associated with that room according to business use. HMRC does not provide exact guidance on how this should be done – you simply need to apportion the costs between business use and private use on a ‘fair and reasonable’ basis.
It’s worth bearing in mind that if you sell your home, Capital Gains Tax will apply to the part of the property used for business unless it serves a dual purpose. For this reason, it’s best to avoid using a room in your home solely for business purposes.
11. Council tax
A lot of Self Assessment customers tend to forget about council tax when calculating their business expenses for the year. But in the same way that you’re permitted to count a portion of your mortgage interest/rent or utility bills against the cost of your tax bill, you can also factor in part of your council tax bill.
The same rules apply regarding calculating the amount you’re allowed to chalk up as an expense. If your home office accounts for 20% of the space in your property, then you are allowed to claim up to 20% of the cost of your council tax on your annual Self Assessment tax bill.
12. Flat-rate simplified expenses
Of all the Self Assessment expenses you should be claiming on your annual tax return, simplified expenses are the easiest. HMRC allows for a no-quibble, flat-rate deduction for sole traders and partners in business partnerships who work from home for at least 25 hours/month.
These deductions vary depending on the number of hours you spend working from home:
- 25 to 50 hours – you can claim a flat rate of £10 per month
- 51 to 100 hours – you can claim a flat rate of £18 per month
- 101 and more hours – you can claim a flat rate of £26 per month
This means that you can claim up to £312 per year through your Self Assessment tax return without the need to work out or keep evidence of the actual costs.
These deductions amount to £26/month when working from home for at least 101 hours each month. This amounts to an annual deduction of £312 that you can include as Self Assessment expenses on your tax return.
The flat rate does not include broadband or telephone expenses, so you can claim these costs in addition to the simplified flat rate.
Whilst simplified expenses are quick and easy to include on your Self Assessment tax return, you may find that you’re missing out on the opportunity to deduct more business costs from your tax bill.
HMRC’s online expenses tool will help you to determine whether it’s better to claim simplified expenses or calculate the actual costs of working from home.
The bottom line
At the end of the day, HMRC will be willing to accept many perfectly reasonable Self Assessment expenses as part of your tax return – particularly if you’re using simplified expenses. That being said, you must be able to prove these expenses are valid.
That means you need to keep records of all of your business expenses as proof of your costs. You do not need to send those records in as proof of expenses when you submit your Self Assessment tax return, and chances are no one will ever ask to see them. However, if HMRC chooses to look into your accounts and asks for proof of your expenses, you should always have them to hand.
That’s 12 of the best Self Assessment expenses you should be claiming – but if you need more guidance, you’ll find loads of how-to guides and useful information on the 1st Formations blog.
If you have any questions about this post, please comment below. You can also contact our London-based team directly if you’d like to speak to someone about setting up a company.
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Comments (109)
Thanks for the article! This highlighting of self-assessment expenses helped me put my own expert financial advice UK business expenses into perspective.
Thank you for your kind feedback!
We are glad the article helped you gain perspective on managing business expenses for your financial advice practice. Understanding self-assessment expenses can be a key step in optimising your financial operations. If you have any further questions or need more insights, feel free to reach out!
The 1st Formations team
Thanks for the article! I never knew about these self assessment expenses could be claimed.
Our pleasure, David.
Kind regards,
The 1st Formations Team
Can I claim for training courses I have paid for on my self assessment that relate to my self employed job?
Thank you for your kind question, Dan.
In general terms, you can claim allowable expenses on training courses which are related to your business, but not which help you to start a new business. For more information, we recommend you take a look at the GOV.UK website page on the subject: https://www.gov.uk/expenses-if-youre-self-employed/training-courses#:~:text=You%20can%20claim%20allowable%20business,start%20a%20new%20business
We trust this information is of use to you.
Kind regards,
The 1st Formations Team
Can food and part utilities be deducted when hosting short term international students?
Thank you for your kind enquiry. To enable us to answer your question more fully, can you advise if you operate a business which hosts short term international students, and get paid in any way?
We look forward to hearing from you in due course.
Kind regards,
The 1st Formations Team
Good post however , I was wanting to know if you
could write a litte more on this topic? I’d be very
thankful if you could elaborate a little bit further. Kudos!
Thanks for your request – we will see what we can do!
Kind regards,
The 1st Formations Team
I’m a sole trader who made a loss in 2020 – 2021 of £462.00 is this recoverable in my 2021-2022 accounts as I’ve now returned to profit? If so where do I need to put this figure in my self assessment form (I do simplified expenses) Thank you
Thank you for your kind enquiry, Tony.
Can you please clarify what you mean by recoverable?
Kind regards,
The 1st Formations Team
Thanks for replying to me. Can my previous year’s losses be offset against this year’s profit thus lowering the amount of tax I have to pay? Sorry if I wasn’t clear on this
Got it now, Tony.
Trading losses can be carried forward to future years and used against profits. However, if you carry the losses forward they can only be used against profits of that same trade. So they can not be set off against any other kind of income like you can if using the losses in the year they arise.
Does this clear things up for you?
Kind regards,
The 1st Formations Team
Great service and thank you very much. What section of the self assessment form does this figure need to be entered into?
Thanks for your follow-up message, Tony.
Unfortunately we would not want to incorrectly advise you, as we are unsure exactly how such a thing should be recorded in your Self Assessment.
We would recommend you seek advice from an accountant regarding this matter. We are sorry we are unable to be of more assistance.
Kind regards,
The 1st Formations Team
Am I right in thinking deductibles need to add up to over £1000 to make it worth claiming for them, i.e. because if not you can instead claim for a tax free allowance on the first £1000 of self-employed earnings instead? For context I am a sole trader and have earnt more than £1000 this tax year.
Thanks in advance for your help on this.
Thank you for your kind enquiry, Kat.
The tax free allowance is related to the first £1,000 of tax being tax free, meaning there is no point in attempting to apply deductibles to it, given as you cannot reduce a tax of £0.
Therefore, the income, as opposed to the deductibles, need to add up to over £1,000 to make it worth claiming.
We trust this information is of use to you.
Kind regards,
The 1st Formations Team
What about investments in stock / shares? How do you allocate these costs?
Thank you for your kind enquiry, Bobby.
With regards to shares, you only pay tax on income from dividends from these shares, if applicable. You can find out more about tax on dividends here: https://www.gov.uk/tax-on-dividends
Income on dividends will need to be reported in your Self Assessment tax return.
We trust this information is of use to you.
Kind regards,
The 1st Formations Team
as a non vat registered sole trader, do I have to subtract the VAT from goods I am going to claim back as expenditure in my tax return?
Thanks for the comment, however, I’m afraid that is not something that we can advise on.
Best regards,
The 1st Formations Team
Hi, I run two businesses from home, can I claim the ‘simplified expenses’ flat rate for each business?
Thanks for the question.
Please note that we are unable to comment on specific circumstances.
Simplified expenses can be claimed by a business that is set up either as a sole trader or as a business partnership.
If you operate multiple businesses then it seems reasonable that you could claim simplified expenses in both businesses. As usual, you will want to avoid the situation of accidentally claiming for the same expense twice.
We hope that helps somewhat, but we do urge you to seek professional advice in regards to this question.
Regards,
The 1st Formations Team
Hi, I am a sole trader and purchased a car for £21,500 how much can I claim as a capital allowance?
Thank you!
Thank you for your kind enquiry, Lauren.
To allow us to answer this question, can you please let us know what percentage of the car’s use is used for business purposes, and what percentage is used for personal purposes?
We look forward to your response.
Regards,
The 1st Formations Team
Hi I am a sole trader selling on Amazon. my turnover went over £85k in tax year 20/21 so as of 1st October 2020 I am VAT registered and have been paying HMRC VAT quarterly since then. Now I have to submit my self assessment tax return, do I take the period from start of tax year 2020 up to 01/10/20 and submit the gross turnover and then from 01/10/20 onwards declare the turnover net of VAT? or do I just submit the VAT payments I have made as an expense? If I use gross turnover figures after I was VAT registered surely I will be in line to pay income tax on money I have actually forwarded already to HMRC? also given that my business is online and I was working pretty much all hours (except sleep) during lockdown, could I justify charging 50-75% of my broadband costs as a business expense? Thank you
Thanks for your kind enquiry, Jim.
You should declare your income Net of VAT and the income before VAT was charged – this should cover both perods you have mentioned. This is because VAT is not your income, it is the government’s income and you are simply holding it until you submit to to them.
With regards to your question about broadbnd, can you tell us if anyone else uses broadband in your place of residence?
Regards,
The 1st Formations Team
As a sole trader yoga teacher renting a studio, am I able to bring forward expenses incurred last year, but not declared on last year’s tax return. I have receipts etc but did not include some of them on last year’s tax return. Is it now too late to include them on this year’s?
Many thanks.
Thanks for your enquiry, Tiri.
You have until 31 January 2023 to make changes to last year’s tax return (i.e. for the 2020/21 tax year). This is how you should declare these expenses you did not input last year. You should not attempt to claim them as expenses incurred in this tax year.
For more information on how to update last year’s tax return, click this link: https://www.gov.uk/self-assessment-tax-returns/corrections
We trust this information is of use to you.
Regards,
The 1st Formations Team
Hi, I have a embroidery machine for work but it’s on finance for 18months. Will I only be able to Claim the cost of the machine when the finance is fully paid off?
Thanks
Thank you for your kind enquiry, Gary.
Company equipment on hire purchase is not applicable for capital allowances. It may be deemed a revenue expenditure as part of your self assessment, but you would need to consult an accountant to ask if this is the case.
We trust this information is of use to you.
Regards,
The 1st Formations Team
Please I need some advice for someone being self employed. My daughter’s income is less than her personal tax allowance. But she has incurred some expenses for the business would she be able to claim the expenses back from HMRC?
Thank you.
Thank you for your kind query, Mary.
As your daughter would not be liable for paying income tax in this scenario, there would be nothing to offset the allowable expenses against, therefore she could not claim back expenses.
If the business is a limited company, the business may be able to claim expenses.
We trust this information is of use to you.
Kind regards,
The 1st Formations Team
Hi John,
Loved your youtube videos. I got a question : i work as a payed Live in Carer (through an agency) 24/7 self-employed ; i used to get the food with the client order (same Tesco order payed by client) but now i get 30£/week through bank for the food allowance , do i need to report them as an income on the self assestment and if yes … can i register them as an expence ?
Thanks,
Radu
Thank you for your kind enquiry, Radu.
You will need to report this allowance on your Self Assessment Tax Return, and yes, you will be able to register these payments as a deductible expense. It is possible that you may not need to pay any tax on this allowance, if your income is below the Personal Allowance threshold.
We trust this information is of use to you. If you have any other questions, please do not hesitate to post a follow up comment.
Regards,
The 1st Formations Team
Hi, your article is very helpful and clear, thank you.
do I deduct the amount of tax I paid from my earnings (like an expense) or not (as in if I paid 2000 pounds tax, do I deduct it from my final yearly earnings?)
thank you
Thank you for your kind enquiry, Florence.
You do not deduct tax from your yearly earnings – you submit earnings to HMRC via the Self Assessment return and then they will inform you what you need to pay in relation to tax. If you make a manual calculation of tax paid or to pay and deduct this from your earnings, you will effectively be underdeclaring the amount you have earnt and pay less tax to HMRC than you are required to pay.
We trust this information is of use to you. Should you require further clarification, please do not hesitate to post a follow up comment.
Regards,
The 1st Formations Team
Hi
I currently rent out a property and I’m having access issues with the neighbour who is blocking / restricting a shared access driveway. I need to use a solicitor to resolve this, can I claim this legal expense back on my self assessment ?
Thanks
Dave
Hi Dave
Thank you for your question.
Unfortunately, I am unable to comment on individual cases; however, please have a look at this article Tax Allowable Expenses for Landlords.
In general terms, legal fees are allowable to set up the first letting and also for renewing leases. I am uncertain if this extends to legal fees re- tenant disputes. I would recommend you seek the assistance of an accountant.
Apologies I cannot be of more help in this instance.
Kind regards,
Graeme
Hi,
New person going into sole trader.
What can you claim back on a £200 week van lease that already has breakdown cover and insurance.
This will be used for business only covering about 100 miles a day.
Many Thanks
Thank you for your kind enquiry, Dave.
In general terms – you can claim your van lease as a capital allowance. For more information, please see this section of the GOV.UK website: https://www.gov.uk/capital-allowances
Should you require any further assistance, please do not hesitate to leave another comment.
Regards,
The 1st Formations Team
Hi, helpful video.
As a sole trader, is it possible to claim on my return for a personal assistant who helps with business matters only i.e. admin? They are freelance.
Thank you for your kind enquiry.
In general terms, you will not be able to claim for a personal assistant who helps you on your Self Assessment return – they would need to claim their own expenses back on their own Self Assessment return; however, you may be able to claim some expenses in relation to them assisting you with work – such as if you have paid for their equipment, internet connection, electricity or rent/lease.
We trust this information is of use to you.
Regards,
The 1st Formations Team
Hi, I’m a newly self employed carpenter, are tools 100% tax deductible? Also I bought a van with savings money can I claim any of that back?(£7,500) I still have it on Hire purchase and I see I can claim the interest back on it. Thanks
Thank you for your kind enquiry, Stephen.
Your tools and van are tax-deductible as a capital allowance, based on the scenario you have described. You can find out more information about capital allowances by visiting this webpage: https://www.gov.uk/capital-allowances
I trust this information is of use to you.
Regards,
The 1st Formations Team
Hi , I pay my tax monthly. Does that come under expenses in my accounting? Or where do you log it!
Thank you for your kind enquiry, Matt.
You are correct – if you pay your tax monthly, this would come under expenses in your accounting.
I trust this information is of use to you.
Regards,
John
Hi John,
Could you confirm if tax payments can only be claimed as an expense if paid monthly or can the standard yearly tax and 1st and 2nd payment on account be claimed and if so do you claim them in the following tax year?
MTIA
Thank you for your kind enquiry, Catherine.
Claimable expenses can generally be claimed whether they are paid monthly or yearly. You will always claim them in the subsequent Self Assessment tax return.
I hope this information is of use to you.
Kind regards,
The 1st Formations Team
Hi,
If I’m completing my self assessment or this year (self employed), would the payments for the last tax year that I’m paying this year be included as an expense?
Thank you.
Thank you for your kind enquiry, Martin.
In general terms, you are unable to claim for expenses on your self assessment return if you have not yet paid for the item you are claiming expenses on. This is because if you do not pay it in the future you would have benefited from more tax-relief than you should have. If you intend to make payments for the last tax year in the current tax year, expenses claims for these payments should be made when you file your self assessment return for this tax year.
I trust this information is of use to you.
Regards,
John
Hi,
My wife is a self employed cleaner who drives to 2-4 customer houses each day. Can you confirm the first and last journeys (from and to home) mileage cannot be claimed for, but journeys between customers can? I have also read that if they are regular customers and addresses that these shouldn’t be claimed for either….all very confusing.
Thank you for your kind enquiry, Darren.
You are correct that the first and last journey mileage cannot be claimed for in your scenario; however, we are not aware of any stipulation regarding regular contacts. Your wife should still be able to claim mileage allowance on visiting the customers in the middle of her day, even if they are regulars.
I trust this information is of use to you.
Regards,
John
Hi,
When working as a freelancer could one identify unpaid administration and comms for my own business (as a sole trader) time as an expense?
Thank you.
Thank you for your kind enquiry, Joao.
Unfortunately it is very unlikely that you would be able to claim unpaid administration and communications for your own business as a sole trader as an expense. This would constitute normal work towards your business. HMRC are quite strict relating to what is and is not considered an allowable expense, and we have covered a lot of them in this blog article.
I trust this information is of use to you.
Regards,
John
I am a courier and will be renting my van at a cost of £168 per week. What can I claim back on my tax for this?
Thank you for your kind enquiry, Simon.
I can confirm that hire charges (rental charges) for vehicles used for work purposes are claimable expenses. For more information, see here: https://www.gov.uk/expenses-if-youre-self-employed/travel
I trust this information is of use to you.
Regards,
John
Hi that information was really useful thanks. My husband has registered his company In his name ( he’s a lower tax earner than me) but all the household bills, mortgage, car etc are all in my name. Will he still be able to use them to offset tax?
Thank you for your enquiry, Rachael.
Regarding the offset of tax by household bills, this may still be possible upon presentation of a marriage certificate along with the evidence (i.e. bills in your name). This, may, however, make it more difficult for this type of claim to be accepted. We would suggest contacting HMRC on 0300 200 3310 to gauge the likelihood of a claim of this nature being successful.
I trust this information is of use to you.
Kind regards,
John
That’s beautiful John.
Greatly appreciate your prompt reply.
– Haneef
No problem Haneef!
John
Hi,
I am so glad and relived that I found this website which is easy to read, undertand and remember all the information from. Kudos for simplifying this, especially the way mileage calculation has been shown with example. I have saved in my favourites to come back and read other extremely useful links.
I just have one little doubt (about section 3 Mileage Cost) please (where you have quoted things right from Vehicle insurance to the last bullet point –> Meals on overnight business trips). My quick question is, for claiming these as expenses, does the vehicle has to be a Company car or is it applicable for personal car as well please?
Many many thanks.
Thank you for your kind enquiry, Haneef.
If you use a personal vehicle for work, you may be able to claim tax relief on the mileage. This covers the cost of owning and running your vehicle. However, you will not be able to claim separately for fuel, electricity, road tax, MOT and repairs.
For more information, please see this webpage: https://www.gov.uk/tax-relief-for-employees/vehicles-you-use-for-work
I trust this information is of assistance to you.
Kind regards,
John
I’m self employed soft tissue therapist at the end of each day I laundry all the towels (wash and dry) I have used for each client – I assume I can claim these expenses but at what rate? Many thanks
Thank you for your kind enquiry, Maxine.
The towels you are using constitute equipment required to carry out your job. If you spend your own money on this equipment, you should be able to claim expenses. Regarding the rate at which you can claim, you will need to lodge a claim with HMRC who will inform you of the rate, as your profession is not listed in the flat rate tax scheme. This does not mean you cannot claim, it just means that it would have to be assessed by an assessor before a judgement is made.
I trust this information is of use to you.
Kind regards,
John
Hi if using simplified accounts can I still claim the van rental charge separate self employed thanks
Thank you for your kind enquiry, Lynda.
If your van was hired for a business journey only, you can claim the van rental cost as a separate expense to your simplified accounts, as your simplified accounts only cover mileage costs of your vehicle.
I hope this information is of use to you.
Regards,
John
Hello,
I filed a self assessment and claimed expenses and I marked the box to pay my self employment tax though my PAYE, this didn’t happen and I now have to pay the tax back in instalments and I lost my claim for expenses due to owing tax, is this correct?
Thank you for your kind enquiry, Nicola.
HMRC have the right to withhold expenses if they believe you owe them a significant amount in income tax. It would appear from the scenario you described that this is the case. We would suggest you contact HMRC directly to confirm the reason why they have rejected your claim for expenses, as they may have rejected it for another reason – for example, lack of supporting evidence.
I hope this information is of use to you.
Kind regards,
John
Hi, this was really informative, thanks so much!
Just wanted to ask if you knew if the £208 no-quibble deduction is still valid? I can’t seem to find that information anywhere else, all I’ve managed to find is HMRC’s standard flat rates:
Hours of business use per month:
Less than 25 – £0
25 to 50 – £10
51 to 100 – £18
101 and more – £26
As I’m probably only in the 25-50hours per week catagory, can I use the £208 rule or would I have to make it £120? (12 x £10 per month)
Thanks so much I’m advance for any help your able to offer!
Dear Samantha,
Thank you for your message. The amount you can claim is based on whether you are self employed or an employee working from home. Based on business hours or 25 to 50 hours per week, self employed workers are eligible to claim simplified expenses of £26 a month (£312 a year). You can find more information about simplified expenses at the following link: https://www.gov.uk/simpler-income-tax-simplified-expenses/working-from-home.
If you are employed and working from home, you can claim up to a maximum of £6 a week (also £312 a year) to cover the additional costs of home working.
I trust this information is of use to you.
Kind regards,
John
I can’t find a section to tick the box to input my lunch expenses. I am a self-employed, sub-contractor. Also when I enter my transport and work clothes expenses my tax back remains the same amount. Even though I’ve only worked 2 months of the financial year.
Thank you for your kind enquiry.
We would recommend you contact HMRC on 0300 200 3310 to assist you, or use their webchat facility if lines are busy. We are aware that HMRC are currently taking longer to answer phone calls at present due to reduced staffing levels as a result of government restrictions relating to the Coronavirus. See here for more information on how to contact HMRC directly: https://www.gov.uk/government/organisations/hm-revenue-customs/contact/self-assessment
I hope this information is of use to you.
Kind regards,
John
Hi can you claim the cost of the monthly instalments on a van if you use it for work and it’s on finance
Thanks
Claire
Hi Claire, thank you for your kind question.
You cannot claim the cost of the monthly instalments on a van, as this is part of the purchase cost. You can claim for mileage, vehicle expenses, repairs and servicing, fuel, parking, vehicle licence fees and breakdown cover.
I trust this information is of use to you.
Kind regards,
John
It’s my first two months in buisness, and then the tax year refreshed and then the pandemic arose.
Net income was £1600
Expenses £1300
Profit £300 as a round up.
No tax to pay. I’ve added my allowable expenses in, I’m confused as wether any of that gets refunded or just get knocked of the tax bill? See people claiming back on Self assessment forms but theres no info, as I say it’s my first time running a buisness and theres no real info out there. Any help would be great
Thank you for your enquiry.
Once you have submitted your Self Assessment tax return and included any allowable expense requests, if and when HMRC accepts these requests, you will either be paid a tax refund direct into your nominated bank account (if you have provided this to HMRC), or a cheque will be sent to your address from HMRC for the amount of the reimbursement.
I trust this information is of use to you.
Kind regards,
John
Hi regarding the uniform can I buy branded polos and trousers and wear solely when in the office will that count towards the infirm
Thank you for your kind enquiry, Lucy.
If the branded polos and trousers have a brand relevant to your business, you will be able to claim these towards your expenses as it would constitute a uniform. Should you buy branded clothing not relevant to your business, HMRC may reject your claim.
I trust this information is of use to you.
Kind regards,
John
I have being paying finance on a van for 3 years it is coming to an end this month.
Can I claim this on my tax return?
Never claim for the van before.
Thank you for your kind question, Ellen.
As you will fully own the van at the end of this month, you should be able to claim this as a capital allowance. A van which transports goods would qualify as an annual investment allowance, and therefore you may be able to deduct the full value of the vehicle from your profits before tax.
For more information, see here: https://www.gov.uk/capital-allowances/annual-investment-allowance
If you require more detailed advice on your particular circumstances, we would advise you seek professional tax advice from a qualified individual.
I hope this is of help to you.
Kind regards,
John
Hi. When working out room allowance for utilities etc, do you count bathrooms in your home as a room to work out how many rooms are in the house ?
Also with fuel can you work it out as a percentage ? I was told a couple of years ago you can. I work mine out as 70% because that’s roughly how much I use my car for work.
Thank you for your question, Lorna.
If your water use in your bathroom is only minor and not directly related to your core business (i.e. your core business does not use a lot of water), you cannot claim this as an allowable expense for the purposes of utilities.
In answer to your question, you may be able to apply a % of the total mileage of the vehicle regarding how much of the total is used for business use; however, HMRC may ask for more information as this method is less exact. It is recommended that you keep a mileage log of all business travel and non-business travel, as HMRC may ask for this information after you submit your claim.
Should you require further assistance with this matter, we recommend you seek professional accountancy advice.
I trust this information is useful to you.
Kind regards,
John
Hi team.
I am a little confused as to what you are saying in section 3.
I am retired with an income from my property portfolio. So l do a self assessment tax return.
I have my own personal vehicle that l use to travel to my properties.
I claim mileage claim at the end of the financial year. It’s claimed at £0.45 pence per mile.
. you say in section 3 that there are additional items l can claim such as .
Insurance mot road fund tax etc etc. I thought that the £0.45 pence per mile covered all of this.
Could I have your response please.
Regards.
Robert
Thank you for your kind enquiry, Robert.
When you make your claim at £0.45 pence per mile, what you are doing is claiming flat rate expenses via simplified. Therefore, insurance, MOT, Road Tax etc are built into these simplified expenses. However, you can also make a claim which itemises all these items separately, and therefore allows you to claim insurance, MOT, Road tax etc separately, as opposed to on a mileage basis. This may lead to a larger expenses allowance, but will require more administration on your part.
You can find more information about this topic here: https://www.gov.uk/expenses-if-youre-self-employed/travel
I trust this information is of use to you.
Regards,
John
Hoping you can help me a little with a query. I work (sole trader) as a podcaster and do a football podcast – naturally that incurs expenses of match tickets. I realise travel expenses would be allowable, but food/drink would not; but would the cost of the actual match ticket? It’s quite central to being able to do the podcast itself, which does bring in money through sponsorship and other means.
Thank you for your kind question, Marty.
Unfortunately, we cannot advise whether you would be able to claim the match tickets as a business expense. Please note that match tickets used for business entertainment purposes (e.g. entertaining clients) are not tax deductible, and this may be hard for HMRC to differentiate from your scenario on your Self Assessment form.
We would recommend you contact HMRC directly on 0300 200 3310 for more advice, or seek professional advice from an accountant.
Kind regards,
John
Hi,
Can I claiming accomodation and travel costs? I mean plane tickets?
Thanks
Kat
Thank you for your kind question, Kat.
The simple answer to your question is yes, you can claim expenses for accommodation and travel costs (e.g. plane tickets) regardless of whether this accommodation is within or outside of the UK. However, you must ensure that personal spending for any trip is kept entirely separate and does not appear on the same receipts/invoices as the business expenses you are claiming for, as this can lead to significant problems with HMRC and they may refuse your claim.
For example, if you were mixing business with pleasure and travelling with a companion who was not related to your business, you must ensure your receipts do not include purchases made for this companion.
I trust the above is of use to you. If you require additional help, we recommend you seek professional advice from an accountant.
Kind regards,
John Carpenter
Hi, I have a question regarding online tax return and claiming capital allowance and milage, wanted to check that can you still claim separately capital allowance and milage or it goes into expenses which is automatically deducted after submitting the actual profit.
Many thanks for your question, Sunny.
In answer to your question, there are separate sections in a Self Assessment tax return to claim for mileage allowances and capital allowances. Therefore, you can claim capital and mileage allowances separately.
I hope this answer has been of help.
Kind regards,
John Carpenter
Hello,
you say bank, overdraft and credit card charges are allowable expenses. Does this include credit card interest?
Many thanks
Thank you for your question, Sean.
Yes, credit card interest counts as a credit card charge and is an allowable expense, as long as the interest are exclusively associated with the running of your business.
I hope this is of help to you.
Kind regards,
John Carpenter
thats a great help. many thanks
No problem Sean, we’re glad you found us helpful.
Kind regards,
John Carpenter
I have to pay a registration fee with my local council to let my property…can I claim this as an expense?
Hi Seonaid
Thank you for your comment.
Unfortunately we are unable to provide advice on taxation and so we cannot comment on specific cases. We would be happy to refer you to our accountancy partners Haines Watts for tax advice. Please let me know: [email protected].
Kind regards,
John
Is point 12 the £104 deduction or the £208 deduction?
I was under the impression that the no-quibble allowance is £2 per week, which is £104 per year – but you have this as £4 which is £208.
Which allowance is it?
Hi there,
Many thanks for your article, it clarified a lot of things I was in doubt with.
I have a question regarding Mortgage and Council Tax. I heard that if one lives and works from home and it’s his/her first home, those expenses are not possible to be claimed. Is that correct?
Are there any rules when working from home and claiming expenses on Mortgage/Rent and Council Tax?
Many thanks!
Hi Denis
Thank you for your comment.
We are now getting into an area which is outside of our expertise as we most certainly cannot provide tax advice to individuals; however, in general terms we understand mortgage interest and council tax is an allowable expense.
Having said that, dependent on how much you use your home for business, you may have to pay business rates rather than council tax, which underlines the fact that tax is a complex matter.
We would be happy to refer you to our accountancy partners Haines Watts for tax advice. Please let me know: [email protected].
Kind regards,
John
Dear Mr Carpenter, many thanks for your useful website. I have a business that I run with the help of an assistant. Where should i put the expenses related to the assistant in the self assessment form? Just in the claimable expenses. Any useful detail?
Regards, Marius Holden
Hi Marius
Thank you for your comment.
Unfortunately we cannot provide advice with regards how you should complete a tax return as this is outside of our expertise; however, I would be happy to refer you to our accountancy partners Haines Watts for tax advice. Please let me know: [email protected].
Kind regards,
John
Hi
As a self employed person, I pay into my pension through a SIPP and incur admin costs charged by the provider.
When I do my tax return can I get claim relief against tax for these expenses ?
Hi Derek
Thank you for your comment.
Unfortunately we cannot provide advice with regards how you should complete a tax return as this is outside of our expertise; however, I would be happy to refer you to our accountancy partners Haines Watts for tax advice. Please let me know: [email protected].
Kind regards,
John
I work abroad as a chef but invoice a uk company, I am UK resident, I’m away in different countries for short periods of time.
They pay my accommodation costs. Am I able to claim for food and subsistence whilst away? Can I claim a flat rate or do I need to keep receipts?
Hi Colin
Thank you for your comment.
Unfortunately we cannot provide advice with regards how individuals make expense claims, as this is deemed to be providing accountancy / tax advice which is outside of our expertise; however, I would be happy to refer you to our accountancy partners Haines Watts for tax advice. Please let me know: [email protected].
Kind regards,
John
Hi there… I am a bit confused… If I claim mileage on my van, I can still claim the diesel? Or has to be one of the two and choose the best option?
Many thanks
Hi Marius
Thank you for your comment.
A mileage allowance claim is only relevant to a personal vehicle, and is not applicable to a company vehicle. So if your van is a company vehicle, you cannot claim a mileage allowance; however, you can claim for fuel or electricity used for business mileage.
If your van is not owned by your business, i.e. it is a personal vehicle, you can claim a mileage allowance for business mileage, and this claim includes for the use of fuel, repairs, MOT, road tax, and electricity.
I trust this is of assistance.
Kind regards,
Graeme