Deductible Expenses for UK Freelancers

Freelancers can claim deductions for expenses that are incurred wholly and exclusively for the purposes of their business. This means that the expense must be directly related to your work and not for personal use.

Some common deductible expenses for freelancers include:

• Cost of goods sold

• Packaging

• Distribution costs

• Staff costs (wages and salaries, pensions)

• Premises costs (rent, insurance, light and heat, cleaning, repairs)

• Office costs (stationery, phone costs, printing, postage)

• Advertising

• Finance costs (but note an interest cap applies under the cash basis)

• Accountancy and legal costs

It is important to keep good records of your expenses so that you can claim them correctly. It would be best if you also kept business and personal expenses separate and ideally have a separate business bank account.

If unsure whether an expense is deductible, you should speak to an accountant.

Here are some additional tips for claiming deductible expenses:

• Keep good records of all your expenses. This includes receipts, invoices, and bank statements.

• Keep business and personal expenses separate. This will make it easier to track your deductible expenses.

• Use a separate business bank account. This will help to keep your business and personal finances separate.

• Speak to an accountant if you are unsure whether an expense is deductible.

By following these tips, you can ensure that you are claiming all of the deductible expenses you are entitled to. This will help you to reduce your tax bill and keep more of your hard-earned money.

Here are some examples of expenses that are not deductible:

• Expenses that are not directly related to your business

• Expenses that are for personal use

• Expenses that are reimbursed by your client

• Expenses that are capital in nature (such as the purchase of equipment)

If you are unsure whether an expense is deductible, you should speak to an accountant.