Even with the best intentions, and using great time saving apps like Quickbooks or Xero, keeping all and every receipt for business expenses can be tiring and take a lot of time.
And that time might be better off spent investing in learning, finding or talking to prospective customers/clients.
In other words time spent working on the business, not ‘in’ the business.
HMRC allow self employed individuals and partnerships to use simplified expenses.
Simplified expenses are a way of calculating some of your business expenses using flat rates instead of working out your actual business costs.
Types of expenses
You can use flat rates for these expenses:
- working from home
- business costs for vehicles
- living in your business premises
FYI: You must calculate all other expenses by working out the actual costs.
First, let’s check if it’s right for you and your business
HMRC have a handy guide here which will help you decide if using simplified expenses is the best option.
You can also call us on 0330 22 11 026 or chat to our team 24/7 on the live chat if you’d like to discuss this. Note that we cannot provide specific advice to people who are not our clients.
How to use simplified expenses
Record your business mileage, hours that you work at home, and how many people live at your business premises.
Then at the end of the tax year (6th April), use these flat rates:
Living at your business premises
Then add them to your self assessment tax return – or use our Dead Simple 5 star rated service! Just click here
Thanks for reading – we’ll be adding further blogs soon.
