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Allowable Business Expenses for Limited Companies

Allowable business expenses play a vital role in reducing tax liabilities for your limited company. To navigate these deductions effectively, always consult with a qualified accountant or tax advisor, especially as rules may change. In this comprehensive guide, Chloe Phelps, Senior Accountant at eAccounts, presents a general list of common allowable business expenses to help you optimise your tax position.

Staff Costs

  • Wages, salaries, bonuses, pensions, employer’s National Insurance contributions, and employee benefits.

Office Expenses

  • Rent, business rates, utility bills, insurance, and maintenance costs for your business premises.

Travel and Accommodation

  • Business-related travel expenses, including mileage, public transport fares, and accommodation costs for employees on business trips.

Business Supplies

  • Costs of stationery, office supplies, and consumables essential for your business operations.

Professional Fees

  • Payments to accountants, solicitors, and other professional advisors for business-related services.

Marketing and Advertising

  • Costs associated with promoting your business, including advertising, website development, and marketing materials.

Training and Development

  • Expenses related to employee training, workshops, conferences, and industry certifications.

Business Insurance

  • Premiums for business insurance policies, such as public liability insurance or professional indemnity insurance.

Renting Equipment

  • Costs of renting or leasing equipment and machinery used in your business.

Business Use of Home

  • If you work from home, you may be able to claim a proportion of household expenses like utilities and rent as allowable business expenses.

Subcontractors and Freelancers

  • Payments made to subcontractors or freelancers for services provided to your business.

Bank Charges and Interest

  • Bank charges, credit card fees, and interest on business loans or overdrafts.

Software and Licenses

  • Costs of business-related software, licenses, and subscriptions.

Research and Development

  • Expenditures on qualifying research and development activities that may be eligible for R&D tax relief.

Repairs and Maintenance

  • Costs of maintaining and repairing business assets, equipment, and property.

Charity Donations

  • Donations made to qualifying charities can be allowable expenses for limited companies.

Remember that allowable expenses should be wholly and exclusively for the purpose of your business. Keep accurate records and receipts to support your claims in case of HMRC inquiries or audits. Always consult with a tax professional to ensure you are correctly claiming allowable expenses and maximising tax efficiency for your limited company.

For more information, contact us at 02921 056 209 alternatively email for assistance.

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