UK tax and accounts basics, explained
Allowable Expenses for the Self-Employed Explained
8 November 2026
General information, not tax adviceEvery figure here is quoted from GOV.UK, with the tax year it applies to. Your own position can differ, so check your HMRC online account and the linked GOV.UK page, or speak to a qualified accountant.
If you're self-employed, allowable expenses can reduce the profit you pay Income Tax on. This guide explains what GOV.UK says you can and can't claim, with a link to each GOV.UK page. It's general information, not tax advice, and if you're unsure about a cost, GOV.UK says to contact HMRC.
Quick answer: GOV.UK says that if you're self-employed you can deduct allowable expenses, the running costs of your business, to work out your taxable profit. You can only claim for business costs, not money taken out for personal use. You can't claim expenses if you use the £1,000 trading allowance instead.
Key Takeaways
Allowable expenses are deducted from your turnover to work out your taxable profit.
You can only claim the business part of a cost you also use personally.
Travel between home and work, fines and everyday clothing aren't allowable.
You can't claim expenses if you use the £1,000 trading allowance.
You don't send proof with your return, but you must keep it in case HMRC asks.
How allowable expenses work
GOV.UK's guide to expenses if you're self-employed gives this example: if your turnover is £40,000 and you claim £10,000 in allowable expenses, you only pay Income Tax on the remaining £30,000, which is known as your taxable profit.
GOV.UK says you're self-employed for this purpose if you're a sole trader or an individual in a business partnership. If you run a limited company, you aren't self-employed, even if you're the owner and only employee. The company deducts its running costs before paying Corporation Tax instead.
Costs GOV.UK lists as allowable
GOV.UK says you can only claim for costs related to business purchases, including:
office costs, for example stationery or phone bills
travel costs, for example fuel, parking, train or bus fares
clothing expenses, for example uniforms
staff costs, for example salaries or subcontractor costs
things you buy to sell on, for example stock or raw materials
financial costs, for example insurance or bank charges
costs of your business premises, for example heating, lighting and business rates
advertising or marketing, for example website costs
subscriptions to trade or professional journals
training courses related to your business
Equipment, machinery and business vehicles are treated differently. If you use traditional accounting, GOV.UK says you claim capital allowances for them instead.
Travel
GOV.UK's page on car, van and travel expenses lists costs such as vehicle insurance, repairs and servicing, fuel, parking, train, bus and taxi fares, hotel rooms and meals on overnight business trips. You can't claim for non-business driving or travel costs, fines or penalty charges, or travel between home and work.
Clothing
According to GOV.UK's page on clothing expenses, you can claim for protective clothing such as safety boots or hard hats, uniforms that aren't everyday clothing, and overalls you only use for work. You can't claim for everyday clothing, such as suits, shirts, dresses or ordinary shoes, even if you wear them for work.
Things you use for business and personal reasons
You can only claim the business part. GOV.UK gives the example of mobile phone bills of £200 for the year, of which £130 is personal calls and £70 is business calls. You can claim £70.
Working from home
GOV.UK says you may be able to claim a proportion of costs such as heating, electricity, Council Tax, mortgage interest or rent, and internet and telephone use. You need a reasonable way of dividing the costs, for example by the number of rooms you use for business or the time you spend working from home.
GOV.UK's example: you have 4 rooms, one used only as an office, and your electricity bill for the year is £1,120. Assuming each room uses the same amount, you can claim £280. If you only worked from home one day a week, you could claim £40.
GOV.UK also mentions simplified expenses, which are flat rates you can use for vehicles, working from home and living on your business premises.
Legal and financial costs
GOV.UK's page on legal and financial costs says accountancy, legal and other professional fees can be allowable, such as hiring accountants or solicitors for business reasons and professional indemnity insurance premiums. You can't claim for fines for breaking the law, or for the cost of preparing and submitting your Self Assessment tax return.
Bank, overdraft and credit card charges, interest on business loans and leasing payments can be claimed. Repayments of loans and overdrafts can't.
Expenses or the trading allowance
GOV.UK's page on tax-free allowances explains that if your gross trading income is more than £1,000, you can choose to deduct the £1,000 trading allowance instead of your expenses. GOV.UK says that if your expenses are more than your income, it may be beneficial to claim expenses instead. You can't do both.
Our guide on how to register as self-employed in the UK covers when the £1,000 figure means you have to register.
How to claim
You tell HMRC your allowable expenses for the tax year on your Self Assessment tax return. GOV.UK's page on how to claim expenses says you don't need to send in proof when you submit your return, but you should keep proof and records so you can show them to HMRC if asked.
Our guide to Self Assessment tax return deadlines gives the dates.
If you're using Making Tax Digital for Income Tax, it uses the same income and expense categories as Self Assessment. Our guide to Making Tax Digital for Income Tax explains who needs it.
For the main dates and thresholds on one page, see key tax dates and thresholds.
Frequently asked questions
Can I claim my travel to work as an expense?
No. GOV.UK says you can't claim for travel between home and work. You can claim business travel costs such as fuel, parking and train fares.
Can I claim the cost of my accountant?
GOV.UK says hiring accountants for business reasons can be an allowable expense, but you can't claim the cost of preparing and submitting your Self Assessment tax return.
Can I claim clothes I wear for work?
Only some. GOV.UK says you can claim for protective clothing, uniforms that aren't everyday clothing and overalls used only for work. Everyday clothing such as suits or ordinary shoes isn't allowable.
Can I claim expenses and the trading allowance?
No. GOV.UK says you can't claim expenses if you use the £1,000 trading allowance.