Expenses will vary a great deal depending on the business and size. According to an IFS report published in July 2019, 23% of sole traders declare expenses of less than £1,000 and 70% declare less than £10,000.
Another way of looking at that is roughly half (47%) of sole traders have expenses between £1,000 and £10,000. 30% will have higher expenses than this.
Expenses can be complicated, but most things that are purchased purely for business can be claimed as an expense. For instance:
- Laptops and computers
- Marketing materials
- Website costs (domain, hosting, etc)
Are likely to be legitimate business expenses. There are some grey areas though, for instance clothes can’t always be claimed.
For sole traders, it’s useful to know that you can deduct a percentage of something used for both personal and business purposes. These rules are different for limited company owners: something an accountant can advise on.
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