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If you’re self-employed, you can claim capital allowances for high-value long life span items providing they are purchased for business use, such as a van.

Please see our guide on capital allowances for more information.

If you are employed, you would not expect to be purchasing such items and would therefore not seek to claim capital allowances.

Self-employed individuals can claim tax relief on their business vehicle’s “Actual” running costs, such as fuel, road tax, and insurance when travelling to temporary workplaces.

If you are using the same vehicle for both work and pleasure, you will need to make sure you only claim the costs incurred for work and not pleasure!

However, the most common method for accounting for vehicle costs is the flat-rate mileage allowance.

Employed workers would not claim “Actual” vehicle costs.

They would instead claim based on the flat-rate mileage allowance, assuming the journey was to a temporary workplace and not the everyday commute to and from your place of work.

The flat-rate mileage allowance can be claimed instead of the actual cost method vehicle method, providing you keep a mileage log. 

As a Self-Employed worker, this means that you can claim expenses on the miles you have driven to work. 

Under the flat-rate allowance, cars and goods vehicles can claim a flat rate of 45p per mile for the first 10,000 miles and a further 25p per mile after that.

However, the flat-rate mileage allowance includes the entire vehicle cost, such as the purchase of the vehicle, fuel, road tax and insurance.

Motorcycles can claim 24p per mile under simplified expenses.

You must keep an accurate mileage log to substantiate and differentiate between business and personal travel, especially if you are using the same car for both business and pleasure. 

The easiest way to keep an HMRC mileage log is with QuickBooks mileage auto-tracking.

Here is more guidance on the flat rate mileage allowance. 

As a PAYE worker, you are only able to claim mileage costs when travelling to a temporary place of work (see above)

If you are Self-Employed, you can claim expenses for any tools or equipment you have purchased, renewed or repaired for your business.

If you are employed, and your employer has not provided you with the same or similar item, then you can claim for the purchase or replacement of that item as an expense, as long as you need it to do the job!

As a Self-Employed & Employer individual, you can claim back travel and subsistence expenses during your time at a temporary workplace.

A workplace is considered temporary if your contract is below 24 months.

If your contract length is uncertain, the workplace will be classed as a temporary workplace until you have been there for 24 months. It would then be considered permanent.

As an Employed worker with one permanent place of work, you cannot claim expenses on travel and subsistence.

However, suppose you are required to work somewhere else temporarily (at another construction site or office, for example). In that case, you may be able to claim travel and subsistence expenses during your time there.

The rules here are ever-changing and Highly specific to your individual circumstances.

Therefore we always recommend seeking professional advice before submitting a claim for us first in these cases, as the majority of such claims are often not allowable.

Such as these…

If you are self-employed and you don’t have to wear a specific uniform on-site, for example, you wear your jeans and t-shirt then. 

Unfortunately, you can’t claim this is a business expense, as it has an intrinsic duality of purpose.

HMRC will always argue that just as we have to eat in order to live, we wear clothes for “warmth and decency” as well as for the requirements of our profession, and this is an argument they always win! 

Uniforms and protective clothing are allowable, but ordinary civilian clothing is not.

If, however, you are asked to wear a specific uniform by your contractor that they haven’t provided, then you may be able to claim for this. 

As an employed worker, if you are provided with a uniform that you must wash, you may be able to claim the tax relief on the laundry by claiming the flat-rate allowance for your trade. 

Which you can do here.

As a Self-Employed individual, your ‘admin costs’ may include items such as a business phone, stationery or postage costs.

As an Employed individual, you are unable to claim expenses in this category.

As a Self-Employed individual, you can claim expenses back on things such as public liability insurance, union fees, working in a home office, etc.

As an Employed worker, you can claim expenses back for trade union and subscription fees, As long as they relate to your specific job.