Quick answer:
The self-employed can claim expenses incurred wholly and exclusively for business, including office costs, travel, stock, certain professional fees, and a portion of home and phone use where relevant. Tracking them digitally reduces your taxable profit and keeps you MTD-ready.
Common allowable expenses
- Office costs: stationery, software, phone and internet (business portion).
- Travel: business mileage at 45p per mile for the first 10,000 miles (25p thereafter), public transport, parking, not ordinary commuting. See GOV.UK simplified expenses for vehicles.
- Stock and raw materials, and the direct costs of what you sell.
- Professional fees: accountancy, certain insurance, relevant subscriptions.
- Use of home for business, either a reasonable proportion of actual costs, or HMRC’s simplified flat rate based on hours worked from home.
- Marketing and website costs.
The “wholly and exclusively” test
An expense must be for business to be allowable. Where something is part-personal (like a phone), you claim the business proportion. Keep it reasonable and recorded, and you’re on solid ground.
A note on the trading allowance
If your total self-employment income is under £1,000 a year, the trading allowance may mean you don’t need to report it at all. Above that, you can either deduct your actual expenses or claim the £1,000 allowance instead, whichever is higher, but not both.
Records make or break your claim
You can only confidently claim what you’ve recorded. Digital capture, receipts attached, categories applied, means you claim everything you’re entitled to without rummaging at year-end.
How CleanBooksAI maximises your claims.
CleanBooksAI categorises expenses automatically, lets you attach receipts, and keeps your tax estimate accurate, so you don’t leave money on the table or pay more tax than you owe.
