Company Expenses

Allowable business expenses reduce the amount of corporation tax your company has to pay on its profits e.g. if you incur an expense of £100, at the current rate of corporation tax of 19%, your company’s corporation tax decreases by £19 (£100 x 19%).

It is important to understand what business expenses you are legitimately allowed to claim.

Whether an expense can be claimed or not depends on whether the expenses meets HMRC’s criteria for a claimable expense.

Important points to remember:

  • All expenses must always be actually incurred and must not be estimated or rounded.
  • You should keep a record of all your receipts as HMRC can, at any time, request to see proof of these expenses for up to 6 years.
  • If IR35 does not apply to your contract, generally speaking, expenses genuinely incurred ‘wholly & exclusively’ for business purposes will be allowable. If any expenses have a ‘dual purpose’ (i.e. non business or private purpose) then they will generally not be allowable. There are, however, examples where the non-business purpose is merely incidental and the expense will still be allowable.

A few of the most common allowable business expenses are:

  • Business travel
  • Mobile phone
  • Telephone
  • Salaries
  • Employer’s national insurance contributions
  • Employer pension contributions
  • Accommodation – whilst away from home on business
  • Subsistence – whilst working away from home
  • Accountancy fee
  • Postage and stationery
  • Use of home as an office
  • Business computer equipment and software
  • Internet subscription
  • Technical journals and publications
  • Business entertaining
  • Professional subscriptions to approved bodies
  • Bank charges
  • VDU Eye tests/eye wear
  • Work related training
  • Relocation expenses
  • Legal and Professional fees
  • Business Insurance

For a comprehensive guide on business expenses our clients can access this from our industry leading First Freelance Contractor Cloud.


I'm an accountant myself but I must say I couldn't have done without the support of First Freelance. – Mugu S.

What I love is that they took the time to meet me in person. I certainly feel I can trust them. – Nadia D.

First Freelance have provided me with excellent support every step of the way. They genuinely care. – Bhargavi P.

The team are knowledgeable and their customer service is outstanding! – Chieme M.

I've worked with many accountants over the years. None have come close to First Freelance. – Daniel J.

They genuinely care about my business and personal finances. – Jennifer W.

First Freelance have provided me with an outstanding level of expertise. I highly recommend them! – Linda P.

I love having 24/7 visibility of my business finances. The 'live' business bank feed is an excellent feature. – Guido M.

What I love is that they took the time to meet me in person and explain everything clearly. – Olufunmilayo A.


Joining First Freelance couldn't be simpler, please provide some basic details and a member of the team will be in touch with you shortly!

Fill out this form to request a callback

You may want to consider:

There are additional factors you may wish to take into consideration. Simply fill in the
form below for a free personalised report tailored to your personal circumstances.

Sign up to our newsletter to receive important tax updates and news that is relevant to you.
We promise to never spam you!