What expenses can a sole trader claim?

The short version

An allowable expense is a cost of running your business. You take it off your income before tax is worked out, so it lowers your profit and your tax bill. The test is simple: is it a cost of running the business? If it was partly personal, you can usually claim only the business part. If it was purely personal, you cannot claim it.

The main categories, with everyday examples

• Office costs. Stationery, printer ink, postage, a business phone plan, software subscriptions such as accounting or design tools.
• Travel. Fuel for business journeys, parking, train, bus and taxi fares to see clients or suppliers, and business trips including a hotel if you stay overnight.
• Clothing. Uniforms and protective clothing, such as a branded hoodie with your logo or steel toe-cap boots you need on site.
• Staff and subcontractors. Wages for people who work for you, and payments to freelancers or subcontractors you hire.
• Stock and materials. Goods you buy to sell on, or raw materials you use to make what you sell.
• Financial costs. Business insurance, bank and card charges, and payment processor fees.
• Premises costs. Rent for a workshop, studio or office, business rates, heating, lighting and similar running costs.
• Advertising and marketing. Website costs, online ads, flyers, business cards.
• Professional fees. Your accountant or bookkeeper, and legal fees.
• Subscriptions. Trade or professional journals and similar.
• Training. Courses related to your business, such as refresher courses.

On the Self Assessment form these are grouped into boxes. Our free tools for AI assistants can sort a list of expenses into those boxes.

Common things you cannot claim

• Entertaining. Lunches, drinks or tickets for clients, suppliers or customers are not allowable, even though they feel like a business cost.
• Everyday clothing. Ordinary clothes are not allowable, even if you only wear them for work. A plain black shirt for meetings is a personal cost.
• Fines and penalties. A parking fine or a late-filing penalty is not allowable.
• Personal spending. Your own groceries, a streaming subscription or a family holiday, and money you take out of the business for yourself.
• Commuting. Everyday travel between home and your normal place of work.
• Capital items. Bigger purchases you keep and use for a long time, such as a laptop, machinery or a van, are not ordinary expenses. Under traditional accounting you claim capital allowances on them instead. If you use the cash basis, most equipment can be claimed as a normal expense, but a business car is still done through capital allowances. You cannot claim capital allowances if you use the trading allowance.
• Expenses and the trading allowance. If you choose the £1,000 tax-free trading allowance, you cannot also claim your expenses against that income.

Costs that are part business, part personal

Some costs serve both, such as a mobile phone, a home internet connection or a car. Claim only the business share, using a fair and reasonable split you can explain. For example, if a phone bill is £50 a month and about 40% of the use is for work, you claim £20. Keep a note of how you worked out the split.

Simplified expenses

Instead of working out exact costs you can use flat rates for three things: vehicles, working from home, and living on your business premises. They save keeping detailed records of those particular costs. See GOV.UK for the current rates, which this guide does not repeat.

Keep your records

• Keep the receipt, invoice or bank record for every expense you claim.
• Write a quick note of what it was for, especially if it is not obvious.
• Keep business and personal money apart where you can; a separate business account makes this much easier.
• Record expenses as you go rather than all at once at the end of the year.

HMRC can ask to see your records, so check GOV.UK for how long you need to keep them.

About this guide

Tax year: 2026/27 (6 April 2026 to 5 April 2027).

Last checked: 9 October 2026 against GOV.UK.

GOV.UK pages used:

• Expenses if you are self-employed
• SA103F notes: self-employment (full) 2026

This guide is general information, not tax advice.