Top 10 Tax-Deductible Business Expenses Explained
Running a business comes with many costs, but did you know that many of these expenses can reduce your tax bill? Knowing what you can and cannot claim as a deductible expense can make a significant difference to your bottom line. Here’s a more detailed look at 10 commonly claimed business expenses in the UK:
Office Supplies – Includes day-to-day items such as pens, paper, printer ink, envelopes, and postage. These are essential for running an office and can be fully claimed.
Business Premises Costs – This covers rent, water, electricity, gas, business rates, and security costs. If you work from home, you can claim a portion of your home expenses too, depending on usage.
Travel Costs – This includes fuel, parking, train fares, taxis, and flights for business purposes. You can also claim mileage allowances if you use your personal car for business (45p per mile for the first 10,000 miles, 25p thereafter).
Staff Salaries and Pensions – Wages paid to employees, national insurance contributions, workplace pension contributions, and even employee benefits such as private healthcare are tax-deductible.
Training Courses – Courses that improve or maintain your skills related to your current business activities can be claimed. However, new skills training or unrelated education usually isn’t deductible.
Marketing and Advertising – Website hosting and design, branding, flyers, business cards, online and print advertising, and sponsorships are all considered legitimate business expenses.
Professional Fees – Accountants, solicitors, consultants, and any other necessary professional services can be included, as long as they are related to your business operations.
Insurance – Business insurance such as public liability, professional indemnity, or employers’ liability insurance are all tax-deductible.
Bank Charges and Interest – Charges for business bank accounts, overdraft fees, and interest on business loans are deductible. Credit card fees used for business purposes may also be included.
Software and Subscriptions – Ongoing costs for software like accounting tools, project management apps, CRM systems, and cloud storage can be claimed.
Understanding what qualifies can save your business money and ensure HMRC compliance, remember all expenses must be wholly and exclusively for the purpose of your trade. Always retain receipts and keep accurate records to support your claims, please reach out to us below if you have any questions.