Smart, compliant claiming for self-employed and small business owners
As a small business owner or self-employed professional, claiming legitimate business expenses is one of the most effective ways to reduce your tax bill and keep your cash flow healthy. But when it comes to HMRC, it’s not just what you claim — it’s how you claim it.
Incorrect, inconsistent, or overly ambitious expense claims are among the most common reasons HMRC flags a return for investigation. So how can you make sure you’re claiming everything you’re entitled to, without inviting unnecessary scrutiny?
Here’s your Soldi Partners Accounting approved guide to claiming business expenses the smart way.
1. Only Claim What’s “Wholly and Exclusively” for Business Use
HMRC’s golden rule is simple: any expense you claim must be “wholly and exclusively” incurred for business purposes.
That means:
A train to a client meeting in London? ✅
A suit you wear to that meeting (which you also wear socially)? ❌
A laptop used 100% for your freelance work? ✅
A family iPad you occasionally send emails from? ❌ (or partially claimable, see #2)
Tip: Always ask: Would I have spent this money if I didn’t run this business?
2. Understand Partial Use – Especially for Home Office or Vehicles
Not everything is black and white. If an item is used for both business and personal use (like your phone, car, or internet), you can still claim a proportion of the cost.
For example:
Claim a percentage of your home internet based on work usage.
Use HMRC’s simplified home office flat rate if working from home.
Log your business mileage instead of claiming full vehicle costs, unless you have a dedicated company vehicle.
Keep records to back up how you calculated the business use.
3. Keep Proper Receipts and Records
HMRC won’t always ask for your receipts — but if they do, you’ll need to prove your claim.
Best practice:
Keep digital copies of receipts using an app or cloud storage.
Avoid vague entries like “miscellaneous” or “general supplies.”
Note what the expense was for (e.g. "business lunch with client at the local bar").
Tip: A bank statement alone isn’t enough — you’ll need the actual invoice or receipt.
4. Avoid Common Red Flags
Here are a few expense claims that HMRC often takes a closer look at:
Large meals and entertainment bills (especially if you’re a sole trader)
Home renovations claimed as office upgrades
High travel expenses with no clear business justification
Duplicate entries or overly rounded numbers
If your claims seem out of proportion for your size or sector, it could trigger further questions — even if you’ve done nothing wrong.
5. Claim Consistently Year to Year
Big swings in your expense claims from one year to the next (e.g. £500 on travel one year, £5,000 the next) could prompt HMRC to take a closer look.
That doesn’t mean you can’t grow your business — but if you’re claiming more, make sure:
It aligns with growth in your turnover
You can explain the change if asked
Consistency is key. Transparency is better.
6. Work With an Accountant Who Knows the Rules
At Soldi Partners Accounting, we help business owners keep more of what they earn — without the risk of HMRC investigations.
We’ll help you:
Maximise what you can claim
Stay compliant with HMRC’s latest rules
Organise your expenses with easy-to-use tools
Be confident in your tax return
Need Help with Business Expenses?
Let’s keep it simple, stress-free, and above board.
Based in Gravesend, we offer local, friendly support for freelancers, sole traders, and limited companies.
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