Limited Company Business Expenses – what can you claim

While running a limited company, you will incur a variety of business expenses during your task of work from stationery and postage price to purchasing computer peripherals. If you incur for expenses, your limited company can receive a Corporation Tax saving on this expense. Corporation Tax Allowances for the tax year 2018/19, is currently 19% and R&D Expenditure credit increased from 11% to 12% for the year 2018/19. It’s very clear to understand what expenses you can be claimed through your limited company and minimize the tax you pay and leads more money to your pocket in the end the tax year.

You can claim the business expenses whether you are small business, contractor or freelancer. If you would like to find out more information about expenses then you may find these pages helpful:

by Vidit Agarwal
by Vidit Agarwal

Below you can find what a valid business expenses you can set off against Corporation Tax:

  • Travel expenses: A contractor can claim the cost of work traveling to and from your temporary place of work. Business related travel which includes Air fares, taxi, bus, parking, tolls etc.
  • Accommodation: The expenses incurred in hotel or bed and breakfast accommodation, meals can be claimed as an expense.
  • Clothing: You cannot claim for every day wear even if you would not be likely to wear your working clothes anywhere other than at work. However, if you required having an item of clothing that is essential to carry out your contract is valid business expense.
  • Training: The cost of updating new skill set is relevant to the performance of your duties under your existing contract then you can claim this as an expense.
  • Business Entertaining: You can claim the reasonable cost of entertaining clients through your company.
  • Staff Entertaining: Cost of an annual event.
  • Pre-trading expenses: Meeting with clients, telephone bills or equipment costs.
  • Executive pension contributions.
  • Capital allowances (depreciation of assets).
  • Company car expenses (benefit in kind charge for private use).
  • Business magazines and books.
  • Travel and parking costs or mileage allowance.
  • Computer equipment and software.
  • Annual work event.
  • Accountancy fees.
  • An eye test for employees who use computer equipment.
  • Employers’ National Insurance Contributions (NICs) on salary above the current NIC threshold.
  • Use of home as office

Other expenses:

  • Marketing and advertising
  • Sub-contractor costs
  • Printing
  • Home office
  • Childcare costs
  • Pension Contributions

In order to claim the business expenses, it is very important to have the record of all receipts of expenses. For more information take a look at below expense pages:

For any of these business expenses and any other costs that you may want to claim back as a business or allowable expenses, it’s important for you remember that you need to retain all the receipts and related paperwork to prove the expense if later asked by HMRC, because if you will ask for expenses claim and unable to produce suitable document to validate the claim that you have to pay backdated income tax and national insurance on the value of the expense.

Limited companies must complete a P11D form, because it contains the details of all expenses claimed by each employee or director during the tax year. You should always consult your accountant if you have any query. For more information claiming expenses through a limited company, you can contact at: 02071480205 or you can book a free consultation today.

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