Self‑Employed Expenses: What You Need to Know

Running your own business means every penny counts. Whether you’re a freelance graphic designer, a one‑person consultancy, or a solo trader selling handmade goods, knowing which costs you can claim and how to keep track of them saves you money and stress.

First off, treat your business like a mini‑company. Open a separate bank account, keep receipts, and set a regular time each week to log expenses. It sounds boring, but it stops the nightmare of hunting down a receipt when HMRC asks for proof.

Common Tax‑Deductible Costs

Most self‑employed people are surprised by how many everyday items are tax‑deductible. Here are the top ones you should be writing down:

• Workspace costs – A home office? You can claim a portion of rent, utilities, and internet based on the space you use.
• Equipment and tools – Laptops, cameras, software licences, and even a good pair of headphones count as business expenses.
• Travel and mileage – Trips to client sites, meetings, or even a coffee shop for a call are claimable. Keep a simple mileage log.
• Professional services – Accounting fees, legal advice, and public liability insurance (a must for many freelancers) are fully deductible.
• Marketing – Website hosting, business cards, and paid ads are all legitimate costs.

Don’t forget the less obvious ones: postage, bank fees, and a portion of your mobile phone bill if you use it for work.

Tools & Tricks to Track Your Spend

Manual spreadsheets can work, but a good app makes life easier. Look for tools that let you snap a photo of a receipt, automatically categorize expenses, and export data for HMRC.

Popular choices in the UK include QuickBooks Self‑Employed, Xero, and the free option in the GOV.UK app for basic record‑keeping. Most of them sync with your bank, pulling in transactions so you don’t have to type everything.

Set a weekly reminder – five minutes a Friday is enough – to upload any new receipts and check that everything is tagged correctly. It builds a habit and prevents the end‑of‑year scramble.

Another tip: keep a “cash envelope” for small purchases like coffee or supplies. At the end of the month, tally the receipts and move the total into your bookkeeping system. It stops cash spend from disappearing into the void.

Finally, remember that you can claim a flat rate expense for some categories, like a set amount per mile driven. That can simplify things if you don’t want to track exact fuel costs.

Managing self‑employed expenses isn’t glamorous, but it directly boosts your bottom line. By knowing what you can claim, using the right tools, and staying consistent, you’ll keep more of what you earn and avoid nasty surprises at tax time.