A guide to tax deductible claims for the self-employed

Welcome to our guide to tax deductible claims for the self-employed. Despite all the many negative aspects surrounding the past year, there remains a relentless passion for enterprise. A great many talented people who are without a job, through no fault of their own, will begin a start-up business. There’s lots of support out there if your one of these people including from www.enterprisenation.com Many start-ups will be self-employed.

A question that we get asked a lot from newly self-employed businesses in Hampshire and Surrey, is about self-assessment and what tax deductible claims can be made for the selff-employed.

Self-employed allowances – where to start

If you are self-employed, you will need to register for self-assessment, this must be done by the 5th of October in your business’s second tax year. If you have not filed a return before you can register online at https://www.gov.uk/register-for-self-assessment/self-employed and HMRC will create your account.

Key dates

Deadline for filing a self-assessment tax return – 31 January

Payment of any tax you owe for the previous tax year and a payment on account (if required) – 31 January

Second payment on account (if required) – 31 July

Self-employed allowable expenses

If you are self-employed, your business will have various operating costs. Some of these costs can be deducted from taxable profit, so long as they are allowable. Below is a summary list of allowable expenses. For the extended and official list and explanation visit https://www.gov.uk/expenses-if-youre-self-employed

Office supplies

  • Stationery
  • Printing costs / ink
  • Postage
  • Phone and internet usage
  • Software used for <2 years or on subscription

Office equipment – under cash-based accounting conditions you can claim for

  • Computer hardware
  • Printers
  • Software used for over two years

Note: if you used traditional accounting you will need to claim capital allowances on these instead

Business Premises

  • Rent
  • Business rates
  • Utilities
  • Insurance (buildings)
  • Maintenance and repair
  • Security costs

Working from Home

Do you work more than 25 hours per month or more from home? There is a simplified expenses framework as follows.

Number of business hours per monthFlat rate per month
25 to 50£10
51 to 100£18
101 +£26


Transport and travel costs that you can claim include any travel necessary for the purposes of your work (except travel and from your place of work). If the car is your own the deductible costs is as per this table

VehicleFlat rate per mile
Cars and goods vehicles (first 10,000 miles)45p
Cars and goods vehicles (after 10,000 miles)25p

Legal and professional costs

You can claim professionals fees as expenses unless they’re associated with the purchase of premises or machinery.

Raw materials/stock

You can claim for raw materials / stock when these are used on the course of your work

Marketing – you can claim for most marketing costs

However you cannot claim for entertaining clients, suppliers or customers or for event hospitality.

Professional insurance

Certain jobs require specific insurances (public liability, professional indemnity, travel) and these are allowable expenses.


Special clothing (a uniform or a costume) that you need to do your job is an allowable claim. Other clothing, even you wear it only for work is not.

 Trade subscriptions

The membership costs associated with trade bodies or professional organisations and the costs of subscribing to professional publications are tax-deductible.

Self Employed National Insurance Contributions (NICs)

If you are Self-Employed there are usually two types of National Insurance to pay.

  • Class 2 if profits are £6,475 or more a year
    • Rate: £3.05 per week (Tax Year 2020-21)
  • Class 4 if your profits are £9,501 or more a year
    • 9% on profits between £9,501 and £50,000
      2% on profits over £50,000 (Tax Year 2020-21)

Profits are worked out by deducting expenses from your self-employed income,  this is why it is important to know what expenses can be legitimately claimed for.  You would usually pay NICs via self assessment.

 If you have any questions about what you can or cannot claim for as part of running a self-employed business, please contact Jason McClounan.

We hope you have found our guide to tax deductible claims for the self-employed helpful, please follow us on Social Media to learn more and ensure you have the latest information to hand.