business expense

What Expenses Can Be Put Through My Business?

November is when those early birds start to get their books in order and start ruffling through all of those receipts and paperwork to get the most accurate portrayal for their year-end tax calculations. If you are a sole trader who works from home, it can be tempting to throw in a few of those luxuries you have splashed out on and claim them as a business expense. However, you have to remember that incorrect claims like these can land you in hot water by upsetting your accountant and a big red flag for HMRC.

Therefore, you need to understand what can be claimed as expenses and what can not to better protect you and your future success.

Business Purposes Only

HMRC defines appropriate business expenditure as something wholly, exclusively and necessarily for trade purposes. Wholly and exclusively means you cannot claim this expense if it served anything other than your business purpose.

You cannot claim a week-long vacation if you just happened to meet one client during one of those days as the trip was not exclusively used for your business. However, you can claim specific expenses that are associated with the meeting.

Necessarily is a slightly harder term to define that is open to interpretation. As an example, you may want to splash out on your employees with a few luxuries around the office for a fun work environment, but you will need to get clarification on this from your accountant or bookkeeping services to find out how HMRC view this. How do you think HMRC would be convinced that a giant adult bouncy castle is 100% necessary to running your business? That may end up being a call for your credit card instead of your business card.

What Does Count

Here are some of the costs that can be classed as wholly, exclusively and necessarily for your business.

Purchases to resell such as raw materials and stock and office costs such as stationery, telephones, postage and software and licences all should be collected. Personal fees fall under such services as legal, accounting and any consultations that you have for the business.

Travel costs such as fuel and mileage, parking fees or public transport to and from the workplace count as claimable, and when it comes to clothing – it does not mean that flashy business suit, it means uniforms or protective clothing needed to do the job.

What About Equipment?

Equipment costs such as any computers, printers and office furniture would be claimable, as well as costs of staff which means salaries, pensions and any business related training courses or qualifications. Your business premises will use significant heating and lighting for both the home and the office – and add business rates and any cleaning contracts required too. You can count on bank charges, insurance and any interest also being part of business expense.

Finally, all of that marketing such as business cards, a website and any print ads or other forms of advertising and professional subscriptions are all to be accounted for.

Anything other than these should be run by your accountant and bookkeeping services in Manchester to be sure. Contact the team at Pebbles Bookkeeping today to get everything in line for your end-of-year and be sure that everything is accounted for.

Don't just take our word for it...

Sarah Rekia, Site Welfare

“In bringing Pebbles onboard, it has made me wonder why we decided to try and do our own bookkeeping at all. Pebbles came in and sorted 18 months worth of mess we had unwittingly created, and we cannot be more grateful. I wish I had been told about them years ago and I hope every business out there struggling would give them a call to fully see the benefits they are missing out on.”

Nick Aldrich, Only The Brave

Only The Brave have used Pebbles Bookkeeping for a few years now and we treat them instinctively like an integral department of our business.

I have worked with Sean for over two decades in my previous businesses and when Sean and Diane went on their own it was a no brainer to get them involved with our day to day accounting.

Pebbles manage our bookkeeping, expenses, credit control and PAYE and have a keen eye for detail and help us spot important financial matters before they become issues.

Their integrity and honesty are unquestionable and as a result, Pebbles are an asset to our business and will continue to work with us for many years to come.

Steve Tanswell, Manchester Facades

I changed book-keepers around a year ago because of a disagreement.  I employed Diane of Pebbles and having been with the same firm for 10 years, I was amazed by how easy working with Diane was.  Not only did the change save me money but also saved me time.  Utilising new technologies (to me) have massively improved the amount of money I can claim back in VAT and has made the whole process speedier and well as easier.  Even when Diane is chasing me for information she does in a friendly professional manner.  I’m thrilled to be working with her and would recommend her to anyone.

Sam Phillips, Sam Phillips Builders

“Sean and the team at Pebbles provide bookkeeping services and do everything from processing invoices to payroll and then final accounts to trial balance.  They have put processes and systems in place that have helped the company track our projects and see if they are profitable and to help us generate better profitability and cash flow.  I highly recommend Pebbles Bookkeeping and often pass their details onto my contacts.”

Anne-Marie Armstrong, Amberry Marketing

I just wanted to thank you both for the help you’ve given me thus far in setting up my new cloud-based bookkeeping system ‘Clearbooks’.

Having used Microsoft Excel for more years than I care to admit, I had more than a few reservations when considering changing the way I managed my books, yet understood that I had to make the change sooner or later.

After an intense training session with Sean, (where I probably asked 101 questions), my fears quickly dissipated and I can honestly say that although it’s likely to take me a little while to really get to grips with the new interface, I’ve no doubt that this simple system will save me so much time and hassle in future.

And less time spent doing my books, almost certainly means more time with the family and an end to rushing around like a mad woman at quarter-end!

Thanks again and I’m looking forward to working with you again soon.