The deductible expenses may be a nightmare for small and medium-sized businesses. However, they are those expenses that, because of their purpose, are useful, necessary and pertinent to achieve the business goals and generate profits.
While an exhaustive inclusion of your expenses in the deductibles can reduce what you pay as tax, for any expense to be deductible, they must be justified by an invoice and accounted for in the business.
An expense will not be deductible if there is no direct relationship with the main business activity. And therefore, it should not be taken into account when obtaining the final fiscal result. So what are the expenses which constitute as deductibles in the UK? Here at Reed & Co Bristol Accountant, we help you out by listing 15 deductible expenses small businesses can claim.
- Operating expenses
These are all those expenses that help us carry out the main activity of our business. That is, they have a direct relationship with the running of the enterprise. Examples are raw materials, packaging, office supplies, combustibles, etc.
- Salaries and wages
These are all the expenses related to the payroll, allowances, extraordinary payments, etc. and that are for the work in the business activity.
- Rentals and maintenance
Rentals and maintenance are deductible if you have a rental office or business premises where you develop your activity. In addition, contracted insurance are included.
- Financial Expenses
These include financial expenses for operations carried out for the business. For example, the payment of interest on the loan, surcharges for deferment of debts, bank charges, etc.
- Travel expenses
As long as the reason for the trip is clearly related to your business activity. In addition, you have to have an expense sheet that specifies this reason and break down all the expenses in the different invoices.
- Insurance premiums
These include premiums of all type of insurance policies being maintained for the assurance of life and property involved in the business.
- Meals
This is a delicate subject. They have to be related and necessary meals for the professional activity, in an overseas location different from the one in which you develop your business and of an appropriate amount.
- Vehicle expenses
Vehicles and all expenses related to them are included (maintenance, insurance, taxes, etc). In order to be deductible, the cars, trucks and other vehicles used must be totally related to the business activity.
- Services of independent professionals
Payment to professionals such as lawyers, auditors, notaries, etc. are deductible.
- Website Costs
You can deduct the costs of the maintenance of your site domain and host.
- Uniform
As long as the wardrobe has the business logo, expenses made on acquiring costumes are deductible.
- Local supplies
Payments for supply services such as water, gas, electricity, phone, postage, etc. are deductible.
- Advertising
Whatever you spend while trying to promote the business for more sales in both the digital and traditional media are fully deductible.
- Telephone and Internet
In this case, we are referring to charges incurred by the landline and the internet connection installed in your office.
- Subscriptions
Do you maintain subscriptions for periodic newspaper or magazine deliveries, usage of software or access to certain online information services which help the business operations? You can claim this as part of your expenses.
If you would like to know more about deductible expenses as well as taxes in Bristol and other areas, you can get in touch with us as soon as possible.
