Tax Allowances for Sole Traders 


All sole traders are entitled to claim for tax allowances whether they have been trading for many years, or just one. Claiming an allowance means that a business can claim tax relief on the ‘allowable’ items which include the below. 

1. Travel and motor running expenses 

Are a type of allowance permitted to claim for fuel, parking, repairs, breakdown cover, insurance, and servicing. It is only possible to claim for business matters, and any personal travel between home and work, non-business driving costs, speeding, or parking fines will not be counted. 

2. Household expenses 

Can be claimed as a sole trader if you work from home and bills are minor. Any rooms in the house used for business purposes should be kept for business purposes during work hours, although allowing family to use the room after work will avoid you being charged Capital Gains Tax when selling your home.  Tax-deductible expenses can be cleaning costs, heating, repairs, electricity, water, council tax, mortgage interest, and rent. 

3. Training courses 

Also qualify as an allowable business expense although it must be relevant to your profession or work, and not something related to entering other marketplaces. 

4. Tools and equipment 

It is also tax-deductible if the sole trader depends on machinery to do their job, and also if maintenance or replacements are needed. 

5. Buying or leasing vans and cars 

It is also claimable business expenses, and there are three leases available (Hire Purchase, Operating Lease, and Finance Lease). 

6. Uniforms’ tax claims 

Only possible to be claimed if they are only able to be used for work, and not ‘everyday wardrobe’. Tradesmen costs for protective clothing and even entertainers for stage costumes can claim tax allowance. 

Contact your local AIMS accountant for more information on how to claim tax reliefs and how they relate to your specific circumstances.