Income Tax Relief explained briefly

If you’re self-employed, your business will have various running costs. You can deduct some of these costs to work out your taxable profit as long as they’re allowable expenses.

Example

Your turnover is £40,000, and you claim £10,000 in allowable expenses. You only pay tax on the remaining £30,000 - known as your taxable profit

office costs, e.g. stationery or phone bills

travel costs, e.g. fuel, parking, train or bus fares

clothing expenses, e.g. uniforms

staff costs, e.g. salaries or subcontractor costs

things you buy to sell on, e.g. stock or raw materials

financial costs, e.g. insurance or bank charges

costs of your business premises, e.g. heating, lighting, business rates

advertising or marketing, e.g. website costs