Allowable expenses for sole traders: what you can and can't claim
21 October 2026 · 6 min read · Checked against GOV.UK 21 October 2026
How expenses reduce your tax
Your tax is worked out on your profit: what you were paid, minus your allowable expenses. In the basic rate band, every £100 of expenses saves about £26 in Income Tax and Class 4 National Insurance.
Example: a mobile dog groomer
What you can usually claim
| Type | Examples |
|---|---|
| Stock and materials | Things you resell, or use to make or do the work |
| Vehicle and travel | Fuel, insurance and repairs, or mileage; train fares, parking and hotels for work trips |
| Phone, internet and software | The business share of your bills, and apps you use for work |
| Office and equipment | Stationery, printing, tools and computers |
| Clothing | Uniforms, protective clothing, and costumes for performers |
| Premises | Rent, rates and utilities for a workshop or unit |
| Insurance and fees | Business insurance, bank charges, accountant's fees |
| Marketing | Your website, adverts and leaflets |
| Training | Courses that update skills you already use in the business |
What you can't claim
- Everyday clothes, even if you only wear them for work.
- Travel between home and a regular workplace: that's commuting. Travel to different clients' sites usually counts.
- Entertaining clients or suppliers, such as lunches or drinks.
- Fines, like parking or speeding tickets.
- Personal costs, and the personal share of anything you also use outside work.
Things you use for work and at home
For a phone, car or broadband you also use personally, claim the share that's for the business. Pick a fair way to work it out, such as the share of calls or miles, and keep a note of how you got there.
Simpler flat rates
Instead of working out real costs, you can use HMRC's flat rates for some things:
- Mileage: 45p a mile for the first 10,000 business miles in a car or van, then 25p. This replaces fuel, insurance, repairs and so on for that vehicle.
- Working from home: £10 a month for 25 to 50 hours, £18 for 51 to 100 hours, and £26 for 101 hours or more. You can still claim the business share of your phone and internet on top.
Costs or the £1,000 allowance
If your costs are small, you can take the £1,000 trading allowance off your income instead. You can't do both, so use whichever leaves less profit.
Keep the receipts
Keep a record of every cost, and the receipt or invoice, for at least five years after the 31 January deadline for that year. From April 2027, Making Tax Digital means many sole traders will keep these records digitally and send HMRC a summary every quarter.
See how your costs change your bill with our self-employed tax calculator. HMRC's full list is on GOV.UK (opens in a new tab).