• Agnieszka Ordakowska

Expenses if you are Self Employed!

As a self employed you can deduct business expenses to reduce you profit as long as they are allowable expenses.



Allowable Expenses:


1. Offices costs


You can claim office equipment if you are going to use it no more then 2 years.


If you use some of the office equipment for personal use you are only able to deduct some of the cost.

EXAMPLE:

You do have one mobile phone and 60% of the calls are business calls and 40% of the calls are private calls. You can only deduct 60% of the bill as only 60% of the calls are used for business purpose.



* Stationery


Allowable expenses:

- phone, mobile, fax

- stationery

- printer, printer ink

- computer software



* Rent & Rates


Allowable expenses:

- rent for business premises

- business bills

- business insurance

- using home as an office


* Property

You cannot make a claim for buying business premises.

You can only claim repairs and maintenance.




2. Vehicle, Car & Travel cost


You can claim allowable expenses as flat rate or actual cost of motor vehicle.


Allowable expenses:

- fuel

- repairs

- insurance

- car park fees

- bus, train, air or taxi fares

- hotel room, B&B


If you have only one vehicle you are only able to deduct some procentage of the actual cost.


If you want to buy vehicle you must use traditional accounting. Ask you accountant how does it work.




3. Clothing


Allowable expenses:

- Protective clothes ie. safety shoes or hi vest

- Uniform - only with not removal and visible logo

- Costumes for actors and entertainers




4. Marketing


Allowable expenses:

- adverts

- free sample

- web site cost

- trade or professional journals

- professional organisation membership only if it's related to your business.


NOT Allowable expenses:

- gym membership

- hospitality

- clients entertaining




5. Staff


You can claim all expenses related to hiring your employees, ie. salary, pension, national insurance contributions, bonuses, agency fee, subcontractors.




6. Reselling goods


You are able to claim all goods you buy for resale and direct cost from producing these goods.

You cannot claim depreciation of this equipment.




7. Legal and financial cost


Allowable expenses:

- accountancy fee

- bank fee

- leasing payments

- solicitors, surveyors and architects only if it's relates to your business.


You cannot make a claim for:

- penalty for speeding

- repayment of loan






If you are not sure what expenses you can claim

always ask your accountant



You can also find more information on https://www.gov.uk/expenses-if-youre-self-employed


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