by Asim Abbas
11 November 2026 
Allowable expenses for sole traders: the complete list
Allowable expenses for sole traders: the complete list
Every allowable expense you claim reduces your taxable profit. For a basic rate taxpayer, each £100 claimed saves £26 in Income Tax and National Insurance.
- Expenses must be wholly and exclusively for the business
- Each £100 claimed saves a basic rate taxpayer about £26
- Simplified expenses cover home and vehicle costs
- You can use the £1,000 trading allowance instead of expenses
Yet many sole traders miss genuine costs, while others claim things HMRC won’t accept.
This guide lists what you can and can’t claim, explains simplified expenses and shows how to keep records that stand up.
The basic rule
A cost is allowable if it’s incurred wholly and exclusively for your business. If something is used for both business and personal purposes, such as your phone, you can claim the business proportion.
What you can usually claim
| Category | Examples |
|---|---|
| Office and admin | Stationery, postage, printing, software subscriptions |
| Phone and internet | Business share of phone and broadband |
| Travel | Fuel or 45p mileage, train fares, parking, hotels on business trips |
| Stock and materials | Goods for resale and raw materials |
| Staff | Wages, pensions, subcontractors |
| Premises | Rent, rates, utilities for business premises |
| Professional fees | Accountant, solicitor, professional body fees |
| Marketing | Website, advertising, business cards |
| Insurance | Public liability, professional indemnity |
| Training | Courses that update existing skills |
| Clothing | Uniforms, protective clothing, costumes |
| Finance costs | Bank charges, business loan interest |
What you can’t claim
- Entertaining clients or customers
- Everyday clothes, even if you only wear them for work
- Commuting to a permanent workplace
- Fines and penalties
- Personal living costs, such as your normal lunch
- Training for a completely new trade
Self Assessment tax calculator
See how expenses cut your tax bill.
Simplified expenses
Instead of working out actual costs, you can use HMRC’s flat rates for some items.
- Working from home: £10 a month for 25–50 hours, £18 for 51–100 hours, £26 for 101 hours or more
- Vehicles: 45p a mile for the first 10,000 business miles in a car or van, 25p after, 24p for motorbikes
- Living at business premises: a flat-rate deduction for private use
Once you use mileage rates for a vehicle, you must keep using them for that vehicle. See GOV.UK for full rates.
A self-employed electrician earns £45,000 and claims £2,100 of van mileage, £600 of tools, £480 of phone costs and £900 of insurance. That’s £4,080 of expenses, saving about £1,060 in tax and National Insurance.
Fixed-fee accountancy support
Transparent monthly packages for sole traders, landlords and limited companies. Fixed fees agreed upfront, VAT included.
Get a fixed-fee quoteCall 0161 531 4179Equipment and capital allowances
Larger items like laptops, tools, machinery and vans are usually claimed through capital allowances. The Annual Investment Allowance lets most businesses deduct the full cost in the year of purchase. Cars are treated differently.
Keeping records
Keep receipts or digital records for at least five years after the 31 January deadline. If you’ll be in Making Tax Digital, records must be kept in compatible software. Our self-employed accountants review your expenses so nothing is missed.
What should I do next?
Highlight every business cost.
Phone, broadband and vehicle.
Pick what gives the better result.
Our sole trader team checks your claims.
Frequently Asked Questions
Can I claim my mobile phone?
Yes, the business proportion. If the contract is in the business name and used mainly for work, you may claim it all.
Can I claim my lunch?
Not your normal daily lunch. You can claim reasonable meals when travelling away from your usual place of work on business.
Can I claim both mileage and fuel?
No. Mileage rates cover fuel, insurance and running costs. Choose one method per vehicle.
Can I claim expenses from before I started trading?
Yes. Costs incurred up to seven years before you started can usually be treated as incurred on your first day of trading.
Can I use the trading allowance and expenses?
No, it’s one or the other. The £1,000 allowance usually suits businesses with very low costs.
Need help with this? Wingate Accountants offers fixed-fee online accountancy support across the UK. Call 0161 531 4179 or request a quote at wingateaccountants.co.uk.
About the Author
Stephen Reynold
I’m Stephen Reynold, an accountant at Wingate Accountants. I work with sole traders and small companies, turning tax rules into clear, practical next steps.
