The basic rule
You can deduct costs you incur wholly and exclusively for your business from your income before working out your tax. Money you take out of the business for personal use isn't an expense. If something is used for both, you can claim only the business share.
What you can usually claim
| Type | Examples for a round trader |
|---|---|
| Vehicle and travel | Fuel, servicing, insurance, parking and tolls for business trips |
| Insurance | Public liability, tools cover, business-use vehicle insurance |
| Tools and equipment | Ladders, poles, machines, hoses and other kit |
| Materials and supplies | Cleaning solutions, fuel for machines, consumables |
| Clothing | Uniforms and protective clothing, not everyday clothes |
| Phone and software | The business share of your phone bill, your round software |
| Marketing | Leaflets, signs, a website, business cards |
| Costs of staff or helpers | Wages and subcontractor fees |
| Training | Courses that relate to your business |
| Bank and card charges | Business account fees and payment processing fees |
| Professional fees | Accountant and some legal costs |
Mileage or actual vehicle costs
If you use your own car or van for the business, you can claim in one of two ways:
- Flat rate per mile (simplified expenses): for 2026-27 that's 55p a mile for the first 10,000 business miles, then 25p. Motorcycles are 24p. You can claim parking, tolls and other travel as well
- Actual costs: fuel, insurance, repairs and servicing, plus capital allowances, based on the business share of use
Tools, kit and capital items
Under the cash basis, most small traders can deduct the cost of equipment they buy for the business, such as ladders, machines and tools, in the year they pay for it. Cars are treated differently. Ask your accountant about a larger purchase like a van.
Working from home
If you do admin at home, you can claim a share of your household costs, or use a flat monthly rate based on the hours you work from home. The flat rate is simpler, and the GOV.UK simplified expenses page has the figures.
What you can't claim
- Money you take out for yourself, and your own wages
- Everyday clothes, even if you wear them to work
- Fines, such as parking and speeding penalties
- Costs unrelated to the business
- Any expenses at all, if you choose the £1,000 trading allowance instead
Keep the receipts
Photograph every receipt when you get it, and file it by date. HMRC can ask to see them for years afterwards, and a pile of faded paper from last March is hard to explain. Putting each one in the right category as you go makes the tax return an afternoon, not a week.
Photograph the receipt, file it under the right heading
Rounds keeps expenses with their receipt photos in categories shaped like HMRC's form, ready for your accountant.