Can I Really Claim That? 5 Sole Trader Expenses You Didn't Know About

Starting your journey as a sole trader can feel overwhelming, especially when it comes to understanding what expenses you can legitimately claim. Many business owners miss out on valuable tax savings simply because they don't know what's allowable. At Josie Dayment Bookkeeping's Sole Trader Academy, we're here to help you navigate business expenses with confidence.

Today, we're uncovering five expenses that could significantly reduce your tax bill – expenses you might not even realise you can claim!

1. Working From Home Expenses (Even Part-Time)

What you can claim: A proportion of your household bills including electricity, gas, water, council tax, mortgage interest, and home insurance.

Many sole traders think they need a dedicated office to claim home working expenses – but that's not true! Even if you work from your kitchen table or spare bedroom for just a few hours a week, you can claim a portion of your household costs.

How it works: You'll need to calculate a reasonable proportion based on either:

• The number of rooms you use for business

• The amount of time you spend working from home

  
  

Example: If you have 4 rooms and use one exclusively for business, you could claim 25% of your household bills. If you only work one day a week from home, you'd claim 1/7th of that amount.

2. Software and Digital Subscriptions

What you can claim: Business software, apps, and digital subscriptions that help you run your business.

Many sole traders don't realise they can claim for the digital tools that make their business run smoother! You can claim for:

• Design software: Canva Pro, Adobe Creative Suite, or other graphic design tools

• Accounting software: Xero, QuickBooks, Sage, or FreeAgent subscriptions

• Project management tools: Asana, Trello, Monday.com, or similar platforms

• Communication tools: Zoom Pro, Microsoft 365, Google Workspace

• Industry-specific software: CRM systems, booking platforms, or specialist trade software

• Website builders: Squarespace, Wix, WordPress hosting and themes

• Cloud storage: Dropbox, Google Drive, or iCloud storage plans

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Basically any software subscription you pay for which is solely for business use, you can claim as a tax deductible expense.

3. Training and Development

Training and development is key to ensure you stay on track of industry trends and so that you’re always improving your knowledge of your industry.

What you can claim: Courses, workshops, books, and subscriptions that enhance your business skills.

Investing in yourself is investing in your business! You can claim for:

• Professional qualification courses

• Industry-specific training workshops

• Business skills development courses

• Professional magazines and publications

• Online learning platforms and software tutorials

  
  

The key is ensuring the training is relevant to your current business activities or helps you develop new skills for your existing trade.

4. Mobile Phone and Internet Costs (Business Portion)

What you can claim: The business portion of your phone and internet bills.

If you use your personal phone or home internet for business purposes, you can claim the business-related portion of these costs.

Example: If your annual mobile phone bill is £200, and you estimate 35% of your usage is for business calls and emails, you can claim £70 as a business expense.

Keep it reasonable and be able to justify your calculations – HMRC may ask for evidence of your business usage.

5. Bank Charges and Financial Costs

What you can claim: Interest on business loans, bank charges, and some professional fees.

Many sole traders overlook these everyday financial costs:

• Bank charges on business accounts

• Interest on business loans or overdrafts

• Credit card interest on business purchases

• Professional fees for accountants and bookkeepers

• Costs for debt collection services

  
  

Even if you use a personal account for business (though we'd recommend a separate business account!), you can claim the charges related to business transactions.

Important Reminders

Keep detailed records: For all expenses, you'll need receipts, invoices, and clear records showing the business purpose.

Business use only: You can only claim the portion of expenses that relates to your business activities.

When in doubt, ask: If you're unsure whether an expense is allowable, it's always worth checking with an expert. That’s why I created my Sole Trader Academy™.

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Ready to Take Control of Your Bookkeeping?

Understanding what you can and can't claim is just the beginning of effective bookkeeping for sole traders. In My Sole Trader Academy™, I’ll guide you through every aspect of managing your business finances with confidence.

From setting up your record-keeping systems to preparing for Self Assessment, our mentoring programme is designed to give you the knowledge and skills to handle your own bookkeeping like a pro.

Want to learn more? Contact us today to find out how our Sole Trader Academy™ can help you take control of your business finances and ensure you're claiming every expense you're entitled to.

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