Allowable Expenses for Self-Employed People in the UK (2026)

If you're a sole trader in the UK, every receipt you keep is a small decision about tax. HMRC lets you take the running expenses of your business away from your income before it works out what you owe, so the profit you're taxed on is smaller than the money that came in. The trick is knowing which spending HMRC accepts, which it doesn't, and what proof you need when it asks.

I've pulled this guide together from HMRC's own pages on GOV.UK, mainly the guide called Expenses if you're self-employed and the simplified expenses pages. It isn't tax advice for your situation. Rules change, and an accountant who knows your business will always beat a general guide, but this should help you go into that conversation knowing the categories and the traps.

What makes a self-employed expense allowable

GOV.UK describes allowable expenses as the running costs of your business that you can deduct to work out your taxable profit. Two ideas sit underneath almost every rule:

• It has to be for the business. Money you take out of the business for your own use isn't an allowable expense.
• Mixed use means a business share only. If something is used for both business and private life, like your phone, you can only claim the business part of it.

The guide applies to sole traders and people in a business partnership. If you run a limited company, you're not self-employed for this purpose, even if you're the only employee: the company deducts its running costs through Corporation Tax instead, so this page isn't your rulebook.

The main groups of allowable expenses for sole traders

HMRC splits allowable expenses into groups. Here's what each one covers in plain words, with the things HMRC says you can't claim alongside.

Expense group	Usually allowable	Not allowable
Office, property and equipment	Stationery, postage, printing, business phone and internet use, rent, rates, utilities, repairs	Any private use of premises, phones or office resources
Car, van and travel	Fuel, insurance, repairs, parking, train and air fares, hotels and meals on overnight business trips	Travel between home and your usual place of work, fines, private journeys
Clothing	Protective wear, uniforms, costumes for performing or advertising	Everyday clothes, even if you only wear them for work
Staff	Salaries, pensions, employer's National Insurance, subcontractors, agency fees	Carers or domestic help such as nannies
Reselling goods	Stock, raw materials, direct costs of producing goods	Goods bought for private use, depreciation of equipment
Legal and financial	Accountancy and legal fees for the business, business insurance, bank charges, interest on business loans	Fines, loan repayments, the work of preparing your own tax return
Marketing	Advertising, website running, mailshots, small branded promotional items	Entertaining clients, suppliers or customers
Subscriptions and training	Trade journals, professional body membership, training that keeps your current skills up to date	Gym membership, political or charity donations, courses for a brand new business

Office, property and working from home

You can claim things like stationery, printer ink, postage, the business share of your phone and broadband, and business software. If you rent business premises, the rent, business rates, utilities, insurance, security and repairs count too. If you work from home, GOV.UK says you can claim a reasonable share of household bills such as heating, electricity, Council Tax, mortgage interest or rent, and internet and phone, as long as the way you split them is reasonable, for example by the number of rooms you use or the time you spend working.

Travel and vehicles

Business journeys are allowable: fuel, parking, insurance, servicing, vehicle tax and breakdown cover for a business vehicle, plus train, bus, air and taxi fares, and hotel rooms and meals when you stay away overnight for work. The big exception catches people out every year: ordinary travel between home and your regular place of work isn't allowable. Fines and penalty charges aren't either.

Clothing

This is the category most people get wrong. Protective clothing like safety boots or a hard hat is fine, and so are uniforms or costumes that aren't everyday wear. A suit you only wear to client meetings still counts as everyday clothing in HMRC's eyes, so it's out.

Marketing, entertaining and subscriptions

Advertising, your website, mailshots and promotional items with your business name or logo are allowable, although HMRC sets a limit per recipient on promotional gifts and excludes food, drink and tobacco from them. Entertaining clients isn't allowable, and that includes the meal, the drinks, the venue and the tickets. Trade journals and professional body membership linked to your work are fine; gym membership isn't, however much it helps you cope with clients.

Simplified expenses: the flat-rate shortcut for self-employed people

Working out the exact business share of your car or your home can be fiddly, so HMRC offers simplified expenses. They're flat rates you can use instead of the real figures for three things:

• Vehicles: cars (except ones designed for commercial use, such as black cabs), goods vehicles like vans, and motorcycles.
• Working from home: available if you work at least 25 hours a month from home. The rate replaces splitting household bills, and it depends on how many hours you work there each month. Phone and internet aren't included, so you claim the business share of those separately.
• Living at your business premises: for example if you run a guest house or care home and live there too.

A few rules to know before you choose. Simplified expenses are open to sole traders and partnerships with no companies as partners, not limited companies. They're optional, and everything else is still worked out using actual spending. For a vehicle, GOV.UK says that once you start using the flat rate you must carry on with it for as long as you use that vehicle for the business, and you can't use it for a vehicle you've already claimed capital allowances on. You can still claim things like parking and train fares on top.

I'd sit down with your numbers from the previous tax year and compare both methods for your own business. For some people the flat rate is close enough and saves hours; for others the real figures are noticeably higher.

The trading allowance and why it changes what you can claim

HMRC also has a tax-free trading allowance for small amounts of self-employed income. It's useful for side hustles, but there's a catch that GOV.UK spells out: if you use the trading allowance, you can't claim expenses or capital allowances as well. So if your business has real running expenses, using the allowance can leave you worse off. Check the current allowance on GOV.UK and run both options before you decide.

Big purchases: capital allowances versus allowable expenses

Equipment, machinery and business vehicles are treated differently from everyday running expenses. Under traditional accounting, you claim capital allowances on them. Under cash basis accounting, GOV.UK explains that you can claim capital allowances on a car, while other equipment is usually claimed as a normal expense. If you've just bought a laptop, a camera or a van, this is a good moment to ask your accountant which route your books use.

Records HMRC expects self-employed people to keep

You don't send receipts with your Self Assessment return, but you must keep records that back up every expense you claim, and HMRC can ask to see them. GOV.UK says sole traders should keep records for at least 5 years after the 31 January submission deadline for the tax year they relate to. If records are lost or destroyed and can't be replaced, you have to do your best to provide figures and tell HMRC whether they're estimated or provisional.

In practice, that means a simple routine:

1. Keep a separate business bank account so business and private spending don't mix.
2. Photograph or scan receipts the day you get them, and note what each one was for.
3. Record mileage for business journeys as you go, not at the end of the year.
4. Write down how you split mixed-use bills such as phone and home energy, so you can explain it later.
5. Review the records each month, not in a panic in January.

If you'd rather not do this on paper, my guide to bookkeeping software for small businesses and my roundup of expense tracking tools cover apps that snap receipts and sort them into categories for you.

Common mistakes with allowable expenses

• Claiming the commute. Home to your regular workplace isn't business travel.
• Claiming work clothes that are everyday clothes. A smart outfit is still everyday clothing.
• Treating client lunches as marketing. Entertaining isn't allowable.
• Claiming all of a phone or car you also use privately. Only the business share counts.
• Using the trading allowance and claiming expenses. It's one or the other.
• Claiming loan repayments. The interest on a business loan can be allowable; paying back the loan itself isn't.
• Losing the paperwork. No record, no defence if HMRC asks.

If you're still weighing up whether to go solo at all, my piece on what to think about before becoming self-employed is a gentler place to start.

When to get an accountant to check your self-employed expenses

A general guide can't see your business. If you work from home a lot, use a vehicle for both business and private life, buy large pieces of equipment, employ people, or have income from more than one source, a short session with an accountant is usually money well spent. They'll also know about any rule changes since this was written. You can find HMRC's full guide by searching GOV.UK for Expenses if you're self-employed.

Frequently asked questions

What counts as an allowable expense if I'm self-employed?

HMRC treats the running expenses of your business as allowable, such as office supplies, business travel, uniforms, staff, stock, business insurance, advertising and relevant training. Private spending isn't allowable, and for anything with mixed use you can only claim the business share.

Can I claim my commute as a business expense?

No. GOV.UK says travel between home and your regular place of work isn't allowable. Journeys to see clients or to temporary places of work for the business usually are.

Can I claim clothes I wear for work?

Only protective clothing, uniforms and costumes that aren't everyday wear. Ordinary clothing like a suit, shirts or shoes isn't allowable, even if you only wear it for work.

Can I claim expenses and use the trading allowance?

No. If you use the trading allowance, you can't also claim expenses or capital allowances. Work out both options for your own figures before you choose.

How long do I need to keep receipts?

GOV.UK says sole traders should keep records for at least 5 years after the 31 January submission deadline for the relevant tax year.

Do simplified expenses work for limited companies?

No. Simplified expenses are for sole traders and partnerships with no companies as partners. Limited companies deduct their running expenses through Corporation Tax.