Earning an extra income: Expenses

As a self-employed individual in the UK, you can offset various expenses against your income on your Self Assessment tax return to reduce your taxable profit. Here are some key allowable expenses you can claim:

Office and Business Premises Costs

- Office supplies like stationery and phone bills

- Costs related to your business premises, including heating, lighting, and business rates

- If you work from home, you can claim a proportion of costs like heating, electricity, Council Tax, mortgage interest or rent, and internet/telephone use

Travel and Vehicle Expenses

- Travel costs such as fuel, parking, train or bus fares

- Car and van insurance, repairs, servicing, and fuel used for business purposes

- Vehicle hire charges and breakdown cover

Staff and Subcontractor Costs

- Salaries and subcontractor costs

Goods and Materials

- Items you buy to sell on, such as stock or raw materials

Financial and Legal Costs

- Insurance or bank charges- Professional fees for accountants, solicitors, surveyors, etc.

- Interest on business loans and credit card charges (up to £500 if using cash basis accounting)

Marketing and Advertising- Website costs and other advertising or marketing expenses

Training and Development

- Training courses related to your business

Other Allowable Expenses

- Clothing expenses for uniforms or protective wear- Professional subscriptions and memberships relevant to your business- Postage and printing costs

It's important to note that you can only claim for the business portion of expenses if they're used for both personal and business purposes.  Additionally, you cannot claim expenses if you use the £1,000 tax-free trading allowance.

When claiming expenses, keep accurate records and receipts as proof of your costs. You don't need to send these with your tax return, but HMRC may ask to see them. Remember to add up all your allowable expenses for the tax year and enter the total amount on your Self Assessment tax return.

Useful information links:

1. https://www.gov.uk/expenses-if-youre-self-employed

2.https://www.gov.uk/expenses-if-youre-self-employed/how-to-claim

3. https://www.unbiased.co.uk/discover/tax-business/self-assessment/tax-deductible-expenses-for-the-self-employed

4. https://www.youtube.com/watchv=QyuOBbx7DHYhttps://www.gosimpletax.com/blog/45-allowable-expenses/

5. https://community.hmrc.gov.uk/customerforums/sa/1fcab33a-d700-ef11-a81c-6045bd0b5701

6. https://community.hmrc.gov.uk/customerforums/sa/c5610c75-a757-ee11-a81c-0022480003c7

7. https://www.1stformations.co.uk/blog/12-self-assessment-expenses-you-did-not-know-you-could-claim/