What expenses can I claim for?
This is a question as contractor accountants that we hear a lot!
Expenses should only be claimed if they are wholly and exclusively for the purpose of the business. They will vary dependant on factors such as location, sector type etc.
We have compiled a list of typical expenses we would expect to see through the majority of a contractor’s limited company:
- Travel & Subsistence – such as train & bus fares, parking and food/drink (when working away).
- Mileage – the current allowable mileage allowance is 45p up to 10,000 and 25p thereafter.
- Insurance – professional indemnity, public liability, you will find that certain insurance must be taken out in your contract.
- Pension Contributions – Paying into your pension from the company will help reduce your company’s corporation tax significantly.
- Post, Print and Stationary – pretty much what it says on the tin.
- Use of home – the current allowance being £208 per annum.
- Telephone – you are allowed one telephone contract per employee and will not incur any benefit in kind for personal use.
- Accountancy fees – you will be happy to know these are 100% tax deductible!
- Eye Test – That’s right, you can claim for an eye test if you use a computer screen whilst at work.
The above is just a minority of the expenses which you may incur, you should always check with your accountant to ensure the expense is allowable.
If you incur a business expense and pay for the cost personally you can reimburse the amount from your limited company profits, meaning your never out of pocket. Speak to your accountant on how to record this correctly.
