Allowable expenses for self-employed UK: the complete 2026 list

Most self-employed people in the UK are paying more tax than they need to. Not because the rules are unfair, but because they miss legitimate expenses they could be claiming.

A spark who drives 15,000 miles a year for work and does not claim mileage is handing HMRC an extra £1,350 they are not owed. A carpenter working from a home office who skips the simplified expenses claim is losing £312 a year. These amounts compound. Over a 5-year period, poor expense tracking can easily cost you £5,000-£10,000 in overpaid tax.

This is every allowable expense a self-employed person can claim in the UK for 2025/26, with exact rates and practical examples for tradespeople.

The golden rule: wholly and exclusively

HMRC's test for allowable expenses is simple in theory: the expense must be incurred "wholly and exclusively for the purposes of the trade." In practice, this causes endless confusion because many expenses have both business and personal elements.

Your van is used for work and weekend trips. Your phone makes business calls and personal calls. Your home is where you live and where you do your paperwork. HMRC accepts that some expenses have a dual purpose, and you can claim the business proportion. But the burden of proof is on you to show the split is reasonable.

Keep records. Keep receipts. Keep a log of business use versus personal use where the line is blurry. If HMRC opens an enquiry and you cannot evidence your claims, they will be disallowed and you will owe tax plus interest.

Vehicle and travel expenses

For most tradespeople, this is the single biggest expense category. You have two options:

Option 1: Simplified mileage (recommended for most)

This is the easiest approach and often the most tax-efficient. If you drive 15,000 business miles in a year: (10,000 x 45p) + (5,000 x 25p) = £4,500 + £1,250 = £5,750 deductible from your profits.

You must keep a mileage log showing the date, destination, purpose, and miles for each business journey. HMRC does not accept round estimates. A simple spreadsheet or app is fine.

Home to your regular place of work is commuting, not a business journey. But driving from your home to a customer's property is business mileage if you do not have a fixed workplace. Most tradespeople who go to different sites each day can claim almost all their mileage.

Option 2: Actual vehicle costs

Instead of mileage, you can claim the actual cost of running the vehicle: fuel, insurance, road tax, MOT, repairs, breakdown cover, and finance interest (not the capital repayment). You then calculate the business-use percentage and claim that proportion.

This method makes sense if you have a cheap-to-run vehicle and high mileage, or if you are leasing an expensive vehicle. The downside: significantly more paperwork. You need receipts for everything and a mileage log to calculate the business-use percentage.

Important: once you choose a method for a vehicle, you must stick with it for the life of that vehicle. You cannot switch between simplified mileage and actual costs from year to year.

On top of mileage, you can also claim:

• Parking fees for business trips (not parking fines - those are never deductible)
• Congestion charges and toll fees for business journeys
• Train, bus, and taxi fares for business travel
• Hotel costs for overnight stays required by a job

Working from home expenses

If you use part of your home for business - doing invoicing, quoting, ordering materials, admin - you can claim a proportion of your household costs.

Simplified method: £6 per week

Claim a flat rate based on the hours you work from home each month:

Most tradespeople who do 1-2 hours of admin per evening would fall in the 25-50 hours bracket, giving them £10/month or £120/year. If you also spend weekends quoting and managing jobs, you could push into the higher brackets.

The commonly quoted "£6/week" figure (£312/year) is the HMRC-approved amount that employed workers can claim without evidence. Self-employed people use the table above instead, though £6/week is a reasonable shorthand for the 51-100 hours bracket.

Actual costs method

Alternatively, calculate the actual proportion of household costs attributable to business use. Add up your rent/mortgage interest, council tax, electricity, gas, water, broadband, and insurance. Then work out the proportion based on the number of rooms used and the hours of business use.

For example, if you use one room of a 5-room house exclusively for business during working hours (roughly 40 hours out of 168 hours per week), the calculation is: 1/5 rooms x 40/168 hours = approximately 4.8% of total household costs. On a household bill total of £15,000/year, that is £714 - more than the simplified rate.

Tools, equipment, and materials

Everything you buy to do the job is deductible. This includes:

• Hand tools and power tools
• Specialist equipment (scaffolding, testing equipment, laser levels)
• Materials bought for jobs (though these are often recharged to the customer)
• Protective equipment and workwear (see clothing section below)
• Software and apps used for the business (accounting software, CAD, job management tools)
• Computer, tablet, or phone if used primarily for business

Items costing under £1,000 can usually be deducted in full in the year of purchase. For more expensive items, you may need to use the Annual Investment Allowance (AIA), which allows 100% deduction in the first year for qualifying plant and machinery up to £1 million. In practice, very few sole traders spend anywhere near the AIA cap.

If a tool is used for both business and personal purposes (rare for most trade tools, but common for phones and laptops), claim only the business-use proportion.

Clothing and uniforms

This is one of the most misunderstood expense categories. The rule is strict:

The test is whether the clothing is "specific to the job" rather than "everyday clothing suitable for general wear." A boiler suit passes. A plain black t-shirt does not, even if you only wear it on site. Add your company logo and it becomes a uniform, which is deductible. Counterintuitive, but those are the rules.

Laundry costs for protective clothing and uniforms are also deductible. HMRC publishes flat rate laundry allowances by trade, typically £60-£120 per year.

Insurance and financial costs

Business-related insurance premiums are fully deductible:

• Public liability insurance
• Professional indemnity insurance
• Employer's liability insurance (if you have employees)
• Tool and equipment insurance
• Van insurance (business-use proportion)
• Business contents insurance

You can also claim: bank charges on your business account, interest on business loans and overdrafts (but not capital repayments), credit card fees for business transactions, and the cost of a business accountant or bookkeeper.

Phone, internet, and subscriptions

If you have a phone used for both business and personal calls, claim the business proportion. The simplest way: get an itemised bill, highlight business calls, and claim that percentage of the total bill. Or get a separate business phone and claim 100% of the cost.

Broadband at home follows the same logic - claim the business-use proportion. Trade magazine subscriptions, professional body memberships (NICEIC, Gas Safe registration, CSCS card renewal), and trade association fees are all fully deductible.

Expenses HMRC will always reject

Some expenses catch people out every year:

The client entertaining rule is the one that surprises most people. Taking a potential client for a pub lunch to discuss a job? Not deductible. Buying biscuits for a meeting? Not deductible. HMRC drew a hard line on this years ago and has never budged.

The £1,000 trading allowance

If your total self-employed income (before expenses) is under £1,000, you do not need to declare it or file a Self Assessment return. This is the trading allowance, and it exists for people with very small side incomes.

If your income is above £1,000, you can choose to deduct the trading allowance instead of your actual expenses. This only makes sense if your real expenses are less than £1,000, which is unlikely for any tradesperson doing this full-time. For most readers of this article, the trading allowance is irrelevant - claim your actual expenses instead.

How long to keep records

HMRC requires self-employed people to keep records for at least 5 years after the 31 January Self Assessment deadline of the relevant tax year. In practice, that means keeping 2025/26 records until at least 31 January 2032.

Digital records are perfectly acceptable. Photograph receipts with your phone, store them in a cloud folder organised by month, and back them up. Paper receipts fade, get lost in van dashboards, and go through the washing machine. Digital is better in every way.

Track every expense as you incur it. Trying to reconstruct a year's worth of expenses from bank statements in January is a miserable experience and you will miss things. A quick photo of the receipt and a 10-second note in your expenses app takes the pain out of it entirely.

Frequently asked questions

Claiming your allowable expenses properly is the easiest legal way to reduce your tax bill. Track expenses as they happen, photograph every receipt, and make sure you are claiming everything on this list that applies to your trade. InvoiceAdept makes it easy to log expenses alongside your invoicing, so everything is in one place when Self Assessment time comes around.