By
August 23, 2026
What Expenses Can a UK Limited Company Claim?
A UK limited company can claim many costs incurred for business purposes as allowable expenses. These expenses can reduce the company's taxable profits and may therefore reduce its Corporation Tax bill.
However, not every payment made by a company is tax deductible. The expense must meet the relevant HMRC rules and generally be incurred wholly and exclusively for the purposes of the business.
Allowable expenses are business costs that can generally be deducted when calculating taxable profits.
Common expenses a UK limited company may be able to claim include:
Whether an expense is allowable depends on what it was for and the applicable tax rules.
A limited company can generally claim qualifying employment costs, including:
PAYE, National Insurance and benefit reporting requirements may also apply.
If your company operates from an office, shop, warehouse or other commercial premises, it may be able to claim costs such as:
The expenses must relate to the company's business activities.
If you run your UK limited company from home, the company may be able to reimburse certain home-working costs.
The amount that can be claimed depends on the circumstances and the method used.
More complex arrangements, such as charging the company rent for using part of your home, can have additional tax implications.
Genuine marketing costs incurred to promote the company can generally be claimed.
Examples include:
These costs should relate directly to promoting the company's business.
A company operating online may incur expenses such as:
Many of these costs can potentially be claimed, although the tax treatment can vary depending on whether the expenditure is revenue or capital in nature.
Business software and subscriptions can generally be claimed when they are required for the company's activities.
Examples may include:
Personal subscriptions unrelated to the business would not normally qualify.
A UK limited company may be able to claim certain professional costs, including fees paid to:
Some professional fees relating to capital transactions or other specific matters may receive different tax treatment.
Qualifying travel undertaken for business purposes can potentially be claimed.
This may include:
Ordinary commuting between home and a permanent workplace is generally treated differently from qualifying business travel.
Where a director or employee uses their own vehicle for qualifying business journeys, the company may be able to reimburse mileage using HMRC-approved mileage rates.
Records should be maintained showing information such as the date, destination, mileage and business purpose of each journey.
Insurance policies taken out for the business can generally be allowable.
Examples include:
The policy should relate to the company's business activities.
Companies selling products may be able to claim the costs associated with:
Accounting rules determine how stock is treated where goods remain unsold at the end of the accounting period.
Certain financial costs incurred by the company may also be deductible.
These can include qualifying:
Special Corporation Tax rules can apply to some financing costs.
Yes, but equipment is often treated differently from ordinary expenses.
Items such as:
may qualify for capital allowances, potentially allowing the company to deduct some or all of the qualifying expenditure when calculating taxable profits.
Qualifying employer pension contributions made for directors or employees can generally be deductible for Corporation Tax purposes, subject to the applicable rules.
Business entertaining is generally not deductible for Corporation Tax purposes, even where there is a genuine business reason for the expense.
This is an important exception because a legitimate business cost is not necessarily an allowable Corporation Tax deduction.
No. Purely personal expenses are not normally allowable business expenses.
Where an expense has both business and private use, the tax treatment will depend on the circumstances. There may also be benefit-in-kind implications where the company pays personal expenses for a director or employee.
Examples of costs that generally do not reduce taxable company profits include:
The exact treatment depends on the nature of each expense.
UK companies should keep appropriate records supporting their expenses.
These may include:
Good records help demonstrate that expenses are genuine business costs and support the figures included in the company's accounts and tax return.
A company may be able to claim qualifying costs such as salaries, rent, software, marketing, insurance, professional fees, business travel, stock and business account charges.
Potentially. Computers and other business equipment may qualify for capital allowances, depending on the circumstances.
A company-provided mobile phone can potentially receive favourable tax treatment where the relevant conditions are met. The rules depend on how the phone and contract are structured.
Certain subsistence costs associated with qualifying business travel may be allowable. Ordinary personal meals are not generally business expenses.
Currency conversion and other financial charges incurred as part of genuine business transactions may potentially be deductible, subject to the relevant tax rules.
Yes. Allowable expenses generally reduce taxable company profits, which can reduce the amount of Corporation Tax payable.
A UK limited company can claim a wide range of legitimate business expenses, from salaries and marketing to software, insurance, professional fees, travel and financial charges.
However, the fact that the company paid for something does not automatically make it tax deductible. The expense must meet the relevant tax rules, and some costs are subject to special treatment.
Maintaining clear records and separating business and personal spending can help a UK company claim the expenses it is entitled to while keeping its accounts and Corporation Tax calculations accurate.
