One of the most common questions we hear from self-employed clients is "Can I claim this as an expense?" The answer depends on a simple but sometimes tricky rule: the expense must be incurred "wholly and exclusively" for business purposes. Let us walk through the main categories and the grey areas that catch people out.
Office and Premises Costs
If you work from home, you can claim a proportion of your household costs — rent or mortgage interest, council tax, electricity, gas, water, broadband, and insurance. The simplest method is to use HMRC's flat rate: £6 per week (£312 per year) with no receipts needed. If your actual costs are higher, you can calculate the business proportion based on the number of rooms used and the hours worked.
If you rent a dedicated office or workspace, the full cost is deductible. This includes rent, business rates, utilities, cleaning, and insurance.
Travel and Vehicles
Business travel is deductible, but commuting from home to a regular workplace is not. If you work from home and travel to client sites, those journeys count as business travel. You can claim the actual cost of fuel, parking, and tolls, or use HMRC's approved mileage rates: 45p per mile for the first 10,000 miles and 25p thereafter for cars.
Equipment and Technology
Computers, phones, printers, software subscriptions, and other equipment used for business are deductible. If an item is also used personally (like a mobile phone), you can only claim the business proportion. Capital items over £1,000 may need to be claimed as capital allowances rather than revenue expenses.
Professional Services and Training
Accountancy fees, legal fees, professional memberships, and insurance premiums are all deductible. Training courses that update or maintain existing skills are deductible, but training for entirely new skills may not be — this is one of the greyest areas in expense claims.
What You Cannot Claim
Personal expenses, clothing (unless it is a uniform or protective equipment), entertainment for clients, fines and penalties, and the non-business portion of mixed-use expenses are all non-deductible. You also cannot claim the cost of your own labour or drawings from the business.
Use our allowable expenses calculator to estimate your deductible costs, or our simplified expenses calculator for HMRC flat rates.
M. Samiuddin QUADRI is a chartered certified accountant at Gladstone & Co. Accountants, helping self-employed clients maximise their legitimate expense claims.