10 Tax Deductions Small Business Owners Often Overlook in the UK
Running a small business in the UK comes with plenty of responsibilities — managing cash flow, growing your customer base, and keeping HMRC happy. One area where many business owners lose out financially is by missing tax-deductible business expenses.
At TAXREADS LTD, we help clients across the UK find legal ways to reduce their tax bills. Here are 10 common tax deductions that small business owners often overlook:
1. Pre-Trading Expenses
Did you spend money before officially starting your business? HMRC lets you claim expenses up to seven years before your start date, as long as they were for business use.
Examples:
- Website development
- Branding and design
- Equipment and software
- Legal setup or professional advice
2. Using Your Home as an Office
Running your business from home? Some of your household costs can be claimed. You can either use a flat rate (simplified method) or calculate actual business use.
Includes:
- Electricity and heating
- Internet and phone
- Rent or mortgage interest
- Council tax and insurance
3. Business Use of Personal Vehicle
Driving your own car for business? You can claim:
- Mileage allowance (45p per mile for first 10,000 miles, 25p after)
- Parking, tolls, and congestion charges
(Note: commuting doesn’t count.)
4. Training and Courses
If you’re improving your current skills, some training may be tax-deductible.
Examples:
- CPD courses
- Online workshops
- Industry-specific training
Learning brand new skills? Those may not qualify — check with your accountant.
5. Memberships and Subscriptions
If you’re a member of a professional body or pay for tools, you might be missing claims.
Eligible items:
- Approved memberships
- Trade journals or industry magazines
- Software subscriptions
6. Bank Charges and Loan Interest
You can claim:
- Business bank fees
- Overdraft charges
- Credit card interest (if business-related)
- Loan interest for equipment
7. Bad Debts (For Accrual Accounting)
If you use accrual accounting and have unpaid invoices that won’t be paid, you can write them off — but you must show that you’ve tried to recover the money.
8. Mobile Phone and Internet Bills
Using personal phone or broadband for business? Track one month’s usage and claim a percentage based on business use.
9. Marketing and Advertising
Don’t forget smaller marketing expenses. You can claim:
- Social media ads
- Leaflets or business cards
- Website hosting and domain renewals
- Freelancers helping with marketing
10. Capital Allowances on Equipment
Buying a laptop, printer, or furniture? You might be able to claim full relief through the Annual Investment Allowance (up to £1 million a year).
Don’t Leave Money on the Table
TAXREADS LTD helps UK small businesses claim every deduction they’re entitled to. Our tax and bookkeeping services keep you compliant and save you money.
Need Help with Your Tax Return or Bookkeeping?
Contact TAXREADS LTD today at [email protected] — your trusted accounting partner in the UK.