Are You Claiming All Your Allowable Expenses as a Sole Trader?
If you’re a sole trader in the UK, maximising your tax efficiency is essential to growing and sustaining your business. One of the most effective ways to reduce your tax liability is by claiming all your allowable business expenses—yet many self-employed individuals leave money on the table by missing out on deductions they’re fully entitled to.
Now is the perfect time to ensure your records are up to date and your expense claims are fully optimised.
What Are Allowable Expenses?
Allowable expenses are costs that are “wholly and exclusively” for business purposes, which can be deducted from your income before tax is calculated. Claiming them reduces your profit, and therefore your tax bill.
Common Allowable Expenses for Sole Traders (UK 2025)
Here are some of the most widely claimable—and often overlooked—expenses:
1. Office and Working from Home Costs
If you rent an office or co-working space, you can claim the full cost. If you work from home, you may be eligible to claim a proportion of your household bills such as heating, electricity, council tax, and internet—based on how much space and time you use for business. Alternatively, HMRC offers flat rate home office expenses depending on your hours worked.
2. Travel and Mileage
Business-related travel is allowable, including train fares, bus tickets, parking fees, and fuel if you're driving for work. If you use your personal vehicle, you can claim mileage at HMRC’s approved rates (45p per mile for the first 10,000 miles, 25p thereafter). Overnight stays for business travel, including hotels and meals, can also be claimed.
🚫 Note: You can’t claim for commuting between your home and a regular place of work.
3. Phone and Internet Bills
You can claim a proportion of your mobile phone and broadband bills based on business use. If your phone is used 50% for business, you can claim 50% of the monthly cost.
✅Keep itemised bills or estimates based on usage is advisable in case of HMRC queries.
4. Equipment and Tools
Items like laptops, printers, cameras, office furniture, and specialist tools can be claimed if used for your business. You can also claim for repairs and replacements, and in some cases spread the cost over several years under capital allowances.
5. Marketing and Advertising
Any spending on promoting your business is allowable—this includes social media ads, Google Ads, local directories, website costs, and printed materials such as leaflets and business cards. Even branding consultations or logo design fees can be included.
6. Professional Fees and Subscriptions
You can deduct fees paid to accountants, bookkeepers, legal professionals, or consultants if their services relate to your business. Memberships to trade associations or professional bodies (e.g., Federation of Small Businesses, CIPD) are also deductible if they help your business operations.
7. Bank Charges and Interest
Charges from a business bank account, including monthly fees and transaction charges, are deductible. If you have a business loan or overdraft, the interest on those borrowings is also an allowable expense.
Commonly Missed Deductions
Many sole traders forget or incorrectly assume the following are not claimable:
Business use of personal car – Even if you don’t have a separate business vehicle, you can claim mileage when using your personal car for client meetings, deliveries, or business errands.
Training and courses – If a course improves your existing business skills (e.g., updating your tax knowledge or improving your marketing), the costs can often be claimed. New qualifications that are unrelated to your current business usually aren’t allowable.
Rent and utilities when working from home – You may be able to claim part of your rent, electricity, water, and council tax if you regularly work from a dedicated space in your home.
Software subscriptions – Programs like Microsoft 365, Canva, Zoom, or industry-specific apps are often overlooked but fully deductible if used for business purposes.
How to Stay Compliant
Claiming expenses incorrectly—or without evidence—can lead to penalties or rejected claims. To stay compliant:
Keep digital or paper receipts for all business expenses, ideally labelled and dated
Use bookkeeping or expense-tracking software to record costs regularly
Maintain a clear distinction between personal and business expenses
Review your expenses quarterly to avoid missing deductible costs
Let Prontus Help You Claim What You Deserve
At Prontus.co.uk, we help sole traders stay compliant, claim all allowable expenses, and reduce their tax bills through clear, proactive bookkeeping. If you’re unsure what you can or should be claiming, let our expert bookkeepers guide you.
Don’t pay more tax than you need to. Make every expense count.
✅ Ready to optimise your 2024-25 tax return?
👉 Get in touch with Prontus today
Disclaimer: This article is for general information only and does not constitute financial or tax advice. Every sole trader’s circumstances are different, and what is allowable for one person may not be for another. Always consult with a qualified accountant or bookkeeper to ensure you’re making the right decisions for your specific situation.
