United Kingdom Tax Glossary for the Self-Employed

A plain-English guide to United Kingdom tax terminology. Whether you are filing your first self-assessment or managing ongoing HMRC obligations, this glossary covers the key terms every freelancer and sole trader should know.

Can I claim my coworking space membership as a business expense in the UK?: Yes — coworking space membership fees are fully allowable as a business expense for UK sole traders and self-employed individuals. HMRC allows you to ...
Is a coffee shop receipt claimable as a business expense for the self-employed in the UK?: It depends on the purpose of the visit. HMRC applies the 'wholly and exclusively' test to all business expenses. If you are working from a coffee shop...
Can I claim my home broadband bill as a business expense if I work from home?: Yes, but only a proportion of the cost. Because your home broadband has a dual purpose — personal use and business use — you cannot claim the full bil...
How do I calculate the flat rate home office allowance for sole traders in the UK?: HMRC offers a simplified flat rate allowance for self-employed people who work from home. This avoids complex calculations of actual costs and proport...
Can I claim my iPhone as a business expense if I also use it personally?: You can claim a proportion of your phone costs based on your business use. Because your iPhone serves both personal and business purposes, HMRC requir...
What mileage rate can I claim for business travel in my own car in 2024/25?: If you use your own car for business travel, HMRC's approved mileage rates for 2024/25 are: - Cars and vans: 45p per mile for the first 10,000 busines...
Can I claim a business lunch with a client as an allowable expense in the UK?: No — HMRC does not allow deductions for business entertaining, which includes meals, drinks, or hospitality provided to clients, customers, or prospec...
Is gym membership tax deductible for the self-employed in the UK?: No — for most self-employed people, gym membership is not an allowable business expense. HMRC requires expenses to be 'wholly and exclusively' for bus...
Can I claim professional indemnity insurance as a business expense in the UK?: Yes — professional indemnity (PI) insurance is fully allowable as a business expense for sole traders and self-employed individuals in the UK. It is i...
How do I claim use of home as office if I rent rather than own my property?: Yes — renters can claim a proportion of their rent as a business expense, just as homeowners can claim a proportion of mortgage interest (actually, ow...
Can I claim my laptop as a business expense as a sole trader?: Yes — if you buy a laptop for your business, you can claim capital allowances on it via the Annual Investment Allowance (AIA), which allows you to ded...
What is the Annual Investment Allowance and how does it work for sole traders?: The Annual Investment Allowance (AIA) allows sole traders to deduct the full cost of qualifying plant and machinery in the tax year of purchase, up to...
Can I claim my van as a business expense as a self-employed sole trader?: Yes — a van used for business can be claimed as a business expense. Unlike cars, vans are classified as 'plant and machinery' for tax purposes, which ...
Why can't I claim my daily commute to work as a business expense?: No — commuting between your home and a regular, fixed place of work is not an allowable expense, even for sole traders and self-employed people. HMRC ...
Can I claim my accountant's fees as a business expense?: Yes — accountant's fees are fully deductible as a business expense. HMRC allows costs incurred wholly and exclusively in connection with your business...
Are legal fees tax deductible for self-employed sole traders in the UK?: It depends on the nature of the legal fees. HMRC draws a distinction between revenue (ongoing) legal costs and capital (one-off, asset-related) legal ...
Can I claim professional membership and subscription fees as a sole trader?: Yes — fees paid to professional bodies and trade associations are allowable if membership is relevant and necessary to your business. HMRC publishes a...
Can I claim training course costs and CPD expenses as a self-employed person?: Yes — training costs are allowable if they are to update or improve skills relevant to your existing business. HMRC allows deductions for courses that...
Can I claim software subscriptions (Adobe, QuickBooks, Microsoft 365) as a business expense?: Yes — software subscriptions used for your business are fully allowable expenses. HMRC treats ongoing software subscriptions as revenue expenditure, m...
Can a photographer or content creator claim their camera as a business expense?: Yes — for photographers, videographers, and content creators, a camera is core business equipment and can be claimed in full via the Annual Investment...