If you’re a freelancer or small business owner, the question “Can I claim this?” comes up constantly. The real issue, however, isn’t whether something fits into a category. It’s whether it reflects genuine commercial activity.
Strong expense claims aren’t built on loopholes. They’re built on commercial logic, clean separation and credible records.
1. Start With Commercial Purpose
Every expense must exist because the business exists. The key test is whether the cost was incurred for the purpose of running your trade.
Freelancers often operate in blurred environments. Working from home, travelling, buying equipment, attending events — all can be legitimate. What matters is the dominant reason for the spending. If the expense would not have happened without the business, the position is stronger. If you would have incurred it anyway and are now attaching a business narrative to it, the risk increases.
Commercial reasoning should drive the decision at the time you spend the money, not afterwards.
2. Separation Is Non-Negotiable
Where business and personal use overlap, discipline becomes critical. Cars, phones, laptops and subscriptions often serve both purposes. That does not automatically disallow them, but it does require proper allocation.
You should be able to explain how you calculated the business portion and support it with evidence. Rounded percentages and reconstructed estimates weaken credibility. Clear logs, structured bookkeeping and separate accounts strengthen it.
The objective is not perfection. It is defensibility.
3. Your Accounts Should Tell a Coherent Story
Zoom out and look at the pattern. If someone unfamiliar with you reviewed your accounts, would they see a focused trading business or a personal lifestyle funded through a company?
Patterns matter more than isolated items. Regular spending on software, marketing, subcontractors and professional advice signals commercial activity. Vague descriptions, high personal-style spending and inconsistent categorisation create questions.
You are not judged on a single receipt. You are judged on whether your accounts make sense as a whole.
4. Think Long-Term, Not Year-End
The most common mistake small business owners make is thinking about expenses only at tax return time. By then, decisions have already been made.
A smarter approach is to view expenses as part of long-term business positioning. Clean accounts improve credibility with lenders. Consistent records support funding applications. Disciplined spending improves profitability. Good structure makes compliance easier under systems introduced by HM Revenue & Customs.
When you approach expenses strategically rather than tactically, you reduce stress, improve clarity and make better commercial decisions overall.
The mindset shift is simple: stop asking what you can get away with this year. Start asking whether your expense profile reflects a serious, commercially run business.
When it does, everything else becomes far simpler.
