As a contractor, there are a vast number of different expenses that can be claimed for when working through a limited company.
These expenses must be deemed wholly, exclusively and necessary for business to carry out it's duties and some examples can include:
- Food (subsistence)
- Computer & office equipment
- Postage & Stationery
- Accountancy, legal & professional fees
- Business insurance
- Telephone & internet
Further information is available on our limited company expenses and tax allowances guide.
If you're working through an umbrella company, the types of expenses you can claim for may include:
- Client billable expenses
- Business costs
- Non-client billable expenses
If you're subject to the SDC legislation, you won't be able to claim for home-to-work travel and subsistence expenses. Find out more in our guide to umbrella contractor expenses.
Download our Ultimate Expenses Guide
Download our Ultimate Expenses Guide
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19 Places to Find Contractor Jobs & Roles
When you get into contracting, it can get stressful when your project end date is just around the corner and you haven't secured your next role. This amps up even more once you finish a contract and you're looking for your next gig.
As a specialist contractor accounting business founded by contractors, one of the key questions we get asked is about where to find roles. So, we decided to compile a list of some of the best contractor job portals, platforms, recruiters and consultancies.
If you have anything else to add then please let us know at firstname.lastname@example.org.
Can I claim for fuel as well as mileage?
Mileage claims are designed to help cover your fuel costs, as well as the running costs of having a vehicle. As such, you can't make separate claims for individual expenses such as fuel, electricity or vehicle repairs.
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.
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.
Self employed expenses & tax allowances guide
Allowable business expenses are costs that you can claim as a deduction against your revenue, which reduces the amount of tax you need to pay.
Here's an example: if your revenue is £35,000 and your allowable expenses total at £5,000, you'll just be taxed on £30,000.
The rules surrounding allowable business expenses aren't always straightforward, and this is where our guide comes into play.
In this article we will run through the most common expenses that sole trader businesses claim for, along with tips you can implement to ensure that you are keeping proper records.
Bear in mind that this isn't a definitive guide, so if you need personalised advice, it's best to consult our accountants atForma.
Guide to employing or hiring contractors
You have an important project at hand, and you require a contractor's specialist knowledge to fill in the skill gap in your team. You're ready to hire-except that you're unfamiliar with the hiring process.
If this is your first time hiring a contractor, our article will guide you through the essentials.
We'll cover the following:
- Sourcing for contractors
- Assessing contractor CVs
- Interviewing a contractor
- Contract terms
- Terminating a contract
Why are expenses important?
Expenses are important as you can claim them against your revenue, which helps to reduce the amount of tax you need to pay.
Can I expense Food & drink?
You can claim "reasonable" food and drink expenses when you're travelling for business, if:
- You're making an occasional business trip outside of your normal pattern of travel
- You're staying overnight, and are also claiming accommodation costs
- Your trade is, by nature itinerant
Can I expense Ebay charges?
Yes, you can claim eBay fees, such as the insertion fee and final value fee as deductible expenses.
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.
Can I expense Utilities?
If you're renting an office, you can claim utilities as a deductible expense.
If you're using your home as an office, you'll need to work out the proportion of your utilities that you can allocate to business use in order to claim these costs as a deductible expense.