If you’re self-employed, your business is going to have running costs for your office, clothing expenses, advertising and more. You can deduct some of these costs to work out your taxable profit - if they’re allowable expenses. Here’s your checklist on the everyday business expenses for self-employed people and what you should be claiming.
- Office, Property and Equipment Costs
- Travel Costs
- Clothing Expenses
- Staff Expenses
- Financial Costs
- Advertising, Marketing and Subscriptions
- Reselling Goods
You can claim items you’d normally use for less than two years as allowable expenses. Here are the office, property and equipment costs you can claim expenses for:
- Computer software.
- Phone, mobile, internet and fax bills.
- Postage costs.
- Printing, ink and cartridges.
Rents, Rates, Power and Insurance
- The rooms in your home used as an office.
- Rent for business premises.
- Utility bills.
- Property insurance.
Sadly, you can’t claim any expenses or allowances for buying building premises. For alterations to install or replace equipment, you can claim allowable expenses if you use cash basis accounting, or capital allowance if you use traditional accounting.
Non-business driving or travel costs, fines and commuting between home and work. These are examples where you can’t claim business expenses.
What you can do is calculate your vehicle expenses using a flat rate (or simplified expense). This is for mileage costs instead of the actual costs of buying and running your vehicle.
Here are some other examples of what you can claim travel expenses for:
- Meals on overnight business trips.
- Vehicle insurance.
- Hotel rooms and accommodation.
- Repairs and servicing.
- Train, bus, air and taxi fares.
- Fuel costs.
- Breakdown cover.
- Hire charges.
- Vehicle licence fees.
Don’t get too excited just yet. You can’t claim for everyday clothing, even if you wear it for work. Here are the clothing items you can claim allowable business expenses for.
- Costumes for actors or entertainers.
- Uniforms and cleaning costs.
- Protective clothing needed for your work.
For staff expenses, you can’t claim for carers or domestic help. So if you do have a nanny for the kids, you can’t claim those expenses. But here’s what you can claim for if you’re self-employed.
- Employer’s National Insurance.
- Staff salaries.
- Agency fees.
When it comes to legal and financial fees, you can’t claim for fines if you’ve broken the law or any legal costs of buying property and machinery. But you can claim for the following.
Legal and Financial Costs
- Professional indemnity insurance premiums.
- Hiring any accountants, solicitors, surveyors and architects for business reasons.
Bank, Credit Card and Other Financial Charges
- Bank, overdraft and credit card charges.
- Alternative finance payments.
- Leasing payments.
- Interest on business and bank loans.
- Hire purchase interest.
Although, you can’t claim for repayment of loans, overdrafts or finance arrangements.
- You can claim for any business insurance policy. For example, public liability insurance, business assets insurance and more.
For advertising, marketing and subscriptions, it can be tempting to claim for every expense possible. Although, you can’t claim for entertaining clients and customers, event hospitality, payments to political parties, donations to charities of gym membership fees. Here’s what you can claim for:
- Advertising in newspapers and directories.
- Website costs.
- Free samples.
- Bulk mail advertising.
- Trade or professional journals.
- Trade body or professional organisation membership if it’s related to your business.
When reselling goods, you can’t claim for any materials or products that you’ve bought for private use. You also can’t claim expenses for depreciation of equipment. But here’s what you can claim allowable business expenses for:
- Goods and stock for resale.
- Direct costs from producing goods.
- Raw materials.
Knowing that you can claim all of these expenses might be music to your ears. But without the right resources, it can be a really long-winded task. That’s why you’ll benefit from an Expense Template to help you get started.
Download a Free Expense Template
If you want to easily track your expenses, then make sure to download our free expense template today. We’ve put together a wide range of templates that will help you better manage your business, such as profit and loss, cash flow, petty cash and more.
Get your free templates now using the link below.