What expenses can a limited company contractor claim?

by | Jun 14, 2019 | Business Expenses Advice, Guides & Resources, Ltd Company

A significant advantage of being a limited company contractor is the enhanced ability to claim tax relief on business expenses. Here we answer the question: “What expenses can a limited company contractor can claim?”

Claiming expenses correctly reduces your profit, which in turn keeps your Corporation Tax down. Knowing what constitutes an allowable business expense will ensure you run your limited company in a tax efficient way whilst remaining compliant with HMRC’s rules.

HMRC’s general guidance states that expenses you claim through your limited company must be ‘wholly and exclusively’ for the business. This is straight-forward guidance which should be simple to follow. However, limited company contracting presents a bit of a challenge – it may be that you work from home and that you use broadband and phone lines for both business and personal use, for example. Read on to find out what business expenses you can claim, and how to keep accurate records.

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Business mileage

When using a personal vehicle to get to a temporary workplace you can claim mileage at the rates shown in the table below.  Your mileage should be recorded on your company accounts as this will help to reduce your overall Corporation Tax bill.  If you drive a company car, you can only claim the cost of fuel.

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Recording expenses

It’s important that you keep accurate records and copies of receipts when claiming business expenses. myJSAonline is our cloud-based online accounting software which all our limited company contractor clients have access to. myJSAonline has been designed to be easy to use, so you can record business expenses quickly and accurately. You should file and retain copies of all receipts and keep them safely filed with your accounting records for at least six years as HMRC could decide to investigate within this time.

Got a question?

Claiming expenses as a limited company contractor can be confusing. That’s why our team of expert contractor accountants is here to help. If you have any questions about any aspect of claiming expenses as a limited company contractor, please get in touch, we’ll be pleased to help.






JSA Group

Specialist outsourced accountancy and payroll services for recruitment agencies, freelancers, contractors and umbrella workers. We’ve built up expert knowledge and experience within the industry by supporting tens of thousands of customers for 30 years.

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