When you work for a company, if you pay for something business related out of your own pocket, you can usually claim it back as an expense. So, for example, you might get a pound back for every mile you drive to get somewhere business related, an exhibition, meeting a client etc.
If you work for yourself, you might assume that any business related expenses that you incur will simply come out of your own pocket. Not so, and you can claim back expenses through your tax return. Generally speaking, an expense is any cost that is wholly and exclusively spent on business.
One of the largest of these costs might be the cost of petrol. Just like when you’re claiming expenses from an employer, through a tax return it’s calculated as a cost per mile. HMRC calculates this as 45 pence per mile.
There are all sorts of other costs that can be classed as expenses. For instance, the cost of your tools might be eligible as a claimable expense. If you work from home then you might be able to claim a proportion of your rent. Paying out wages could also be considered an expense.
You might worry that you don’t have accurate numbers for your expenses. You don’t need dead on accurate figures, and estimates are acceptable. Of course, it’s important that these estimates are as accurate as possible or you could risk investigation and a hefty fine.