What expenses can a sole trader claim?
Allowable expenses are business costs you deduct from your income to work out taxable profit before paying Income Tax. gov.uk lists office costs, travel, clothing, staff costs, stock for resale, insurance and bank charges, premises costs, advertising and training. Items used both privately and for business are claimed only for the business share.
Figures checked against gov.uk on . General information, not tax advice.
The categories gov.uk lists
gov.uk groups allowable expenses under these headings:
- office costs, such as stationery and phone bills;
- travel, such as fuel, parking, and train or bus fares;
- clothing, such as uniforms;
- staff costs, such as salaries and subcontractor fees;
- goods bought for resale, such as stock and raw materials;
- financial costs, such as insurance and bank charges;
- premises costs, such as heating, lighting and business rates;
- advertising and marketing, such as website costs;
- subscriptions to trade or professional journals, and training courses related to your business.
What you cannot claim
Money taken from the business for your own use is not an allowable expense, and you cannot claim expenses if you use the £1,000 trading allowance on the same income. For anything used for both business and personal purposes, claim only the business share.
Expenses are deducted from income to give your profit, which is the figure Income Tax and Class 4 National Insurance are charged on.