To make it clearer, we’ve listed the main expenses contractors can claim: Goods In other words, you can’t claim expenses that also relate to personal use. While you can claim most of your expenses against your tax bill, it’s important to note that you can only claim for costs that relate to your business. Expenses like marketing costs and professional fees are strong indicators that you operate as a separate entity from your clients, which supports your IR35 status. Learn more about how IR35 affects contractors in this guide. In turn, you increase your company’s value and maximise the profits available for investment or drawing dividends (profits you pay your shareholders).Īdditionally, claiming your business expenses is an important part of demonstrating your company’s independence if you work outside IR35. You’ll come away with a lower tax bill (meaning you owe less in tax) and more spendable cash for your business. While this may seem counterproductive, deducting business expenses can improve the financial health of your company. Most expenses you have as a contractor will be tax-deductible, meaning you can deduct them from your business’ profits. Why should you claim expenses as a contractor? You can learn everything you need to know about business expenses in our ultimate business expenses guide. This could include travel expenses, phone and internet bills, and in some cases, even a proportion of your utility bills if you work from home.
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