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Simplified expenses: A guide for sole traders and partnerships

by Intuit•5• Updated 3 months ago

Simplified expenses let you claim certain business costs using flat rates, instead of working out the actual amounts spent. This can save you time when completing your Self Assessment tax return.

You can use simplified expenses if you're:

  • A sole trader, or
  • In a partnership, as long as none of the partners are limited companies

For more details, visit HMRC: Simplified expenses.


When can I use simplified expenses?

You can use simplified expenses to claim flat rates for business mileage, working from home, and living at your business premises.

To do this, you'll need to keep track of:

  • Business miles driven using your own vehicle
  • Hours worked from home each month
  • Number of people living at your business premises (if applicable)

If you use your car, van, or motorbike for work, you can claim a flat rate per mile instead of tracking fuel and maintenance costs.

Vehicle typeFlat rate per mile
Cars and good vehicles (first 10,000 miles)45p
Cars and good vehicles (first 10,000 miles)25p
Motorcycles24p

Note: You can't use these rates if you’ve already claimed capital allowances for the vehicle, or included it as a business expense when calculating profit.

If you work from home 25 hours or more a month, you can use HMRC’s flat rates to claim a portion of your home running costs (like electricity and heating).

Hours worked from home (per month)Flat rate (per month)
25 to 50ÂŁ10
51 to 100ÂŁ18
101 and moreÂŁ26

Note: These rates don’t include telephone or internet bills. You can still claim the business portion of those separately.

This applies if you live in the same place where you run your business — for example, running a B&B where you also live. You can use flat rates to calculate your personal use of the space.

The amount should be deducted from your total premises expenses so you only claim the business portion.

Number of people living thereFlat rate (per month)
1ÂŁ350
2ÂŁ500
3+ÂŁ650
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