Business insurance costs can be reclaimed through your business and are eligible for Corporation Tax relief.
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Can I claim personally paid expenses?
There may be times when you have no option but to use your personal funds to cover company costs such as paying by cash or if you forget to bring your company card. It's important to keep a copy of the receipt of all expenses but this is especially important when paying for costs and expenses personally. This way, a record of the cost can be kept, logged in your company accounts and then your company can reimburse you for this.
What is a retroactive date on professional indemnity insurance?
The retroactive date on your professional indemnity insurance is the date from which you've held uninterrupted professional indemnity insurance, or a date in the past from which your insurer has agreed to cover you.
Personally paid expenses vs company paid expenses
Where possible, it is advisable to cover any company expenditure directly using company funds such as directly via the company bank account. This ensures that all company transactions are kept in one place and can be easily tracked.
Do I have to pay tax on expenses?
You do not need to pay tax on allowable business expenses. These are essential business costs that are incurred "wholly and exclusively" for the purposes of running the business. They can be deducted against your income, thereby reducing the amount of tax that you need to pay.
Can I expense Taxi fares or an Uber?
Taxi fares are generally deductible, as long as the fares aren't incurred for ordinary commuting. According to HMRC, a commute is a trip you make most days between your home and permanent workplace.
How much employers' liability insurance do I need?
The law requires most employers to have at least £5 million of employers' liability insurance, and the fine is a maximum of £2,500 for every day that you don't have this cover. In practice, most insurers will give you £10 million of cover as standard, so you don't usually have to choose a cover level when you're buying your employers' liability insurance.
Can I expense Software?
You can claim the costs of purchasing computer software that your business uses for less than two years. You can also claim for computer software that you use for more than two years, if your company makes payments regularly to renew the license.
How much does professional indemnity insurance cost?
The cost of a professional indemnity insurance policy depends on several factors. As with other types of insurance, insurers will calculate the price of your professional indemnity insurance (your premium) based on a number of things, including the type of business you run and the level of cover you select.
What business insurance do I need?
Business insurance is designed to protect you from the risks associated with running a business.
While some risks and their accompanying covers are common to most businesses, others are more niche.
The protection you'll need will depend on the risks your business faces. In this article, our business insurance partner, Superscript explains the types of business insurance you may want to consider.
What is a Contractor?
You've been thinking about making the leap from employee to self-employed. If contracting is one of the options you're considering, this article is for you.
We'll run you through the basics, including what it means to be a contractor, how it differs from full-time employment and the type of business structures that contractors typically choose.
Contractors are self-employed individuals who provide services to a business. Generally, they're highly skilled, and are hired for projects that require specialist skills or to bolster a team during busy periods.
What is an insurance broker?
Insurance brokers are professionals who sell various types of insurance coverage to clients.
Auto, home, health, life, property, and other varieties of insurance all fall under this umbrella. Some insurance brokers work independently and others work for brokerage firms; some deal with individuals, and some elect to work only with businesses.
An insurance broker's job is to help inform clients of how best to handle risk management. They help make it possible for individuals and companies to obtain and provide insurance for themselves, their families, their property, and their businesses.
Within the UK, brokers are regulated on the state level.
They're often required to hold a specialized license that can only be obtained after completing education and testing requirements. The information they learn during the period prior to certification allows them to guide clients and answer their questions without trouble. Brokers seek to help clients understand their liabilities and how to manage those risks most effectively.
Can I claim expenses before my company was formed?
Yes. You can claim pre-trading expenses of up to seven years before the incorporation date of your limited company, as long as these expenses have been paid for with your own money and were incurred ‚Äòwholly, exclusively and necessarily' for setting up your business.
Examples of pre-trading expenses you can claim for include:
- Internet and domain name fees
- Purchase of computer equipment and software
- Accountancy and other professional fees
- Travel costs
To learn more about allowable business expenses, read our expenses and tax allowances guide for limited company directors.
Can I expense mobile phone?
As a sole trader, you can't claim for the line rental if you're using your mobile phone for business and personal use. You can claim the costs of business calls, if these are indicated on an itemised bill. To claim for the costs, you'll need to set up a mobile contract under your business name, and use it solely for business purposes.
As a limited company director, you'll need to set up a contract between your company and service provider in order to claim the full costs as a deductible business expense. If the contract is made under your personal name, you won't be able to claim the costs as an expense.
Refer to our guide on mobile phone expenses for further information.
How much does business insurance cost?
The cost of your business insurance depends on the nature of your work, the type of insurance you need, and your cover levels. Businesses that are perceived as riskier will usually pay a higher policy price.
What is subcontracting?
As an independent contractor, there may come a point in time where you need to consider subcontracting-you might decide to take on work as a subcontractor, or hire a subcontractor for your projects.
Whichever option you're exploring, how do you decide if the benefits truly outweigh the cons? And are there important tips you need to keep in mind?
Can I expense Legal costs?
The costs incurred for engaging professional services-such as hiring a lawyer-can be claimed as an allowable expense, as long as these services are carried out solely for business purposes.
Can I expense Professional fees?
The costs incurred for engaging professional services-such as hiring an accountant, lawyer or architect-can be claimed as an allowable expense, as long as these services are carried out solely for business purposes.