Business Expenses You Might Be Missing (and Can Claim!)

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A checklist titled "Business Expenses" with items including use of home, mileage and travel, subscriptions, training, software and online tools, bank fees, clothing, and advertising, all checked off.

Business Expenses You Might Be Missing (and Can Claim!)

Running a business means tracking every penny — especially when it comes to tax time. But even the most diligent business owners can miss out on legitimate expenses that could reduce their tax bill. Whether you're a sole trader, limited company director, or freelancer, understanding allowable business expenses is key to maximising your profit and staying HMRC-compliant.

In this article, we’ll uncover commonly overlooked business expenses you might be missing — and can claim!

What Are Allowable Business Expenses?

Allowable business expenses are the costs you incur wholly and exclusively for the purpose of running your business. Claiming them reduces your taxable profit, meaning you pay less tax.

HMRC has clear guidelines on what can and can’t be claimed, but there are many grey areas and commonly missed opportunities.

What Are Allowable Business Expenses?

Allowable business expenses are the costs you incur wholly and exclusively for the purpose of running your business. Claiming them reduces your taxable profit, meaning you pay less tax.

HMRC has clear guidelines on what can and can’t be claimed, but there are many grey areas and commonly missed opportunities.

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1. Use of Home as Office

If you work from home, you can claim a proportion of your household bills — like heating, electricity, internet, and even mortgage interest or rent — based on business usage.

Two ways to claim:

  • Flat rate: HMRC allows a simplified method starting from £10/month (based on hours worked).

  • Actual cost method: Calculate the actual cost of using your home — often more generous.

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2. Mobile Phone and Internet Bills

If you use your mobile phone or broadband for both personal and business use, you can still claim the business proportion of the cost. Keep records to justify your calculation.

✔ Tip: Limited companies should consider setting up a business contract in the company’s name for full deductibility.

Illustration of a beige private jet parked on an airstrip with a brown suitcase in front, and green mountains and clouds in the background.

3. Mileage and Travel Expenses

Do you drive your personal vehicle for business purposes? You can claim:

  • 45p per mile for the first 10,000 miles

  • 25p per mile thereafter (cars/vans)

Also claim for:

  • Parking fees

  • Train and bus fares

  • Taxis (when necessary)

  • Hotel stays and meals while travelling for work

🛑 Not claimable: Travel between home and your regular place of work (unless you're home-based).

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4. Subscriptions and Memberships

Many forget you can claim subscriptions related to your trade. This includes:

  • Professional bodies (e.g. ICAEW, CIPD, RIBA)

  • Trade journals and magazines

  • Industry-specific software tools (e.g. Adobe Creative Cloud, QuickBooks)

Digital illustration of a laptop screen displaying the words 'Training Education' with a play button, next to a graduation cap.

5. Training and Education

Ongoing training that helps you improve skills relevant to your current business is an allowable expense.

✅ Claimable: A marketing course to improve your current freelance marketing business
❌ Not claimable: A course for a new skill unrelated to your current trade

Illustration of a laptop screen displaying icons for online software tools, including settings, analytics, documents, and cloud upload, with the text 'SOFTWARE ONLINE TOOLS'.

6. Software and Online Tools

From accounting platforms to design software and CRM systems — these are all deductible if used for your business.

Examples:

  • Microsoft 365 or Google Workspace

  • Canva Pro

  • Xero or FreeAgent

  • Shopify, Wix, or Squarespace (if you run a website)

Graphic of a brown T-shirt and safety helmet with the word 'CLOTHING' underneath, all in shades of brown, on a beige background.

8. Clothing

MRC is strict about clothing. You can only claim:

  • Uniforms

  • Branded clothing with your logo

  • Protective gear (e.g., steel-toe boots, hi-vis vests)

❌ Normal clothing (even if worn for work) is not allowed.

Illustration of a megaphone, a web browser window with an ad, and a target with an arrow hitting the bullseye, with the text "Advertising and Marketing" beneath.

9. Advertising and Marketing

Claim the full cost of:

  • Google Ads / Facebook Ads

  • Printed flyers and posters

  • Website hosting and design

  • SEO services

  • Branded giveaways and promo materials

Marketing expenses are fully allowable as long as they promote your business.

An illustration of a bank building with a pound currency symbol and text "Bank Fees and Interest."

7. Bank Fees and Interest

You can claim:

  • Business bank account fees

  • Credit card fees (if used for business)

  • Interest on business loans

  • Leasing costs for equipment

🚫 You can’t claim personal overdraft charges or loan interest unrelated to the business.

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10. Bad Debts (For Limited Companies)

If you've issued an invoice and made reasonable attempts to collect the money but haven’t been paid, you might be able to write it off as a bad debt and claim it as an expense — reducing your taxable profit.

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11. Charitable Donations (Limited Companies Only)

Donations to registered charities can reduce your corporation tax bill. These must be cash donations, and the charity should be registered in the UK.

Office supplies including stapler, paper clips, push pins, colored pencils, rulers, sticky notes, calculator, notepad, tape, and pens arranged on a wooden surface with the text 'Office Supplies and Stationery' in the center.

12. Office Supplies and Stationery

A staple expense that’s often under-claimed. You can include:

  • Printer ink and paper

  • Postage costs

  • Office furniture

  • Pens, notebooks, envelopes

If you work digitally, you can also include digital equivalents like PDF editors or e-signature tools.

Don’t Forget: Keep Proper Records

To claim any expense, you need to:

  • Keep digital or physical receipts

  • Use accounting software or spreadsheets

  • Maintain mileage logs

  • Justify personal vs business use

This protects you during HMRC audits and ensures you're not over- or under-claiming.

Final Thoughts: Small Claims Add Up

Missing out on even minor business expenses can mean paying more tax than you need to. Regularly reviewing your spending and understanding what’s allowable is key to maximising profit and minimising your tax liability.

If you want to make sure you’re not missing out, talk to a trusted accountant or bookkeeper who can audit your current expense strategy.

Work With an Accountant

An accountant will not only help you claim every eligible expense but will also ensure you stay compliant and avoid penalties. They might even find expenses you didn’t realise you could claim — potentially saving you hundreds or even thousands each year.

13. Client Entertainment (With Caution!)

You can’t claim entertaining clients or suppliers as a tax-deductible expense.

But you can claim:

  • Meals while working away from home

  • Staff events (like a Christmas party up to £150 per head)

Fun Fact (or Urban Legend?)

In New York, there was reportedly a strip club called "Office Supplies" — and yes, some businesspeople claimed visits there as a tax-deductible expense. Why? Because the name would show up as “Office Supplies” on receipts, raising fewer eyebrows with their accountants (or the tax man).

A valid expense?

From a tax perspective — absolutely not. HMRC (and the IRS too) require expenses to be “wholly and exclusively for the purpose of business.” Entertainment, especially of the adult variety, is explicitly disallowed — even if it's sneakily named. Trying to claim this could get you into trouble for misrepresentation.

Our take?

It’s clever… but cheeky. Probably a better pub story than a tax strategy. Stick to actual office supplies (like paper and pens) — not pole dancing.

Want help separating legitimate claims from risky write-offs? We got your back.

Here’s a clip featuring Jimmy Carr referencing the “Office Supplies” strip club story in a crowd-working segment:

"What’s the best strip club you’ve been to?!" #jimmycarr