Expense Categories (annual amounts)
Reg. 07380272 · England & Wales · Est. 2010
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Total Expenses
£0.00
Tax Saving
£0.00
Monthly Saving
£0.00
Marginal Rate
20.0%
Deduction Rate
0.0%
Enter your expense amounts to see the breakdown.
Everything you need to know about claiming self-employed expenses
What are allowable expenses for the self-employed?
Allowable expenses are costs that you incur wholly and exclusively for the purpose of your self-employed business. HMRC lets you deduct these from your income before calculating tax, which reduces your tax bill. Common examples include office supplies, travel costs, professional fees, and business insurance. The key rule is that the expense must be for business purposes only — personal expenses or mixed-use costs need to be apportioned.
Can I claim expenses if I use the cash basis?
Yes, most allowable expenses can be claimed under both the cash basis and traditional accruals basis. Under the cash basis (the default for most sole traders), you claim expenses when you actually pay them rather than when you receive the invoice. Some expenses like depreciation and certain finance costs have different rules under the cash basis, but the majority of day-to-day business expenses are claimed the same way.
What about working from home — can I claim that?
If you work from home, you can claim a proportion of your household costs (heating, lighting, broadband, council tax, mortgage interest or rent) based on the business use. HMRC also offers simplified expenses for home working: £6/week (£26/month) flat rate with no receipts needed, or you can calculate the actual proportion of costs attributable to business use. The flat rate is simpler but the actual cost method often gives a higher deduction.
Do I need to keep receipts for all expenses?
Yes, HMRC requires you to keep records of all business income and expenses for at least 5 years after the 31 January submission deadline for the relevant tax year. You should keep receipts, invoices, bank statements, and mileage logs. Digital copies (photos or scans) are acceptable. If you are ever investigated, HMRC will want to see evidence supporting every expense you have claimed.
What happens if I claim more expenses than my income?
If your allowable expenses exceed your income, you make a trading loss. Under the cash basis, you can carry the loss forward to offset against future profits from the same trade. Under the accruals basis, you have more options: you can set the loss against other income in the same year, carry it back to the previous year, or carry it forward. Trading losses cannot create a negative tax bill — the minimum taxable profit is zero.
The "Wholly and Exclusively" Rule
HMRC's fundamental test for any business expense is that it must be incurred wholly and exclusively for the purposes of your trade. This means the expense must have a clear business purpose. If an item has both business and personal use (like a mobile phone), you can only claim the business proportion. Keeping clear records of business vs personal use is essential.
Categories of Allowable Expenses
Office & Stationery
Stationery, printing, postage, phone bills, broadband, computer consumables.
Travel & Transport
Business mileage (45p/mile first 10k), parking, public transport, accommodation for business trips.
Equipment & Tools
Computers, software, tools, machinery — claim full cost under cash basis or capital allowances.
Professional Services
Accountant fees, legal costs, professional subscriptions, training courses related to your business.
HMRC-Aligned: This calculator uses official HMRC rates and thresholds for the 2025/26 tax year. The tax saving shown is based on your marginal rate and may differ if your expenses move you between tax bands. For complex situations, consult a qualified accountant.
This calculator uses official rates and thresholds from:
Last verified: February 2026 · Tax year 2025/26. Results are indicative — consult a qualified accountant for personalised advice.
Reviewed by M. Samiuddin Quadri, ACCA — Chartered Certified Accountant at Gladstone & Co. · Updated for the 2025/26 tax year.
Disclaimer: This calculator provides estimates based on current HMRC rates and thresholds for the 2025/26 tax year. It does not constitute professional tax, financial, or legal advice. Your actual liability may differ depending on your individual circumstances. Always consult a qualified accountant or tax adviser before making financial decisions. Read our terms