Tax allowances for self-employed and directors

HMRC provides tax allowances for self-employed and directors of companies. These allowances are based on standard rates.

How to find my UTR number?

Mileage Allowance

The mileage allowance is available to taxpayers who use their own vehicles for business purposes. There are different rates for cars and vans, motorcycles and bikes. The current rates are per mile travelled for business purposes:

Type of vehicleRate per mile up to 10,000 milesRate per mile over 10,000 miles
Cars and vans45p25p
Motor cycles24p24p
HMRC business mileage rates

Passenger payments – cars and vans

In addition to the mileage allowance, you can claim 5p per business mile for carrying fellow employees in a car or van providing the journey is also a work journey for the passenger.

Working from home – use of home as office

You can claim a flat rate for the use of your home as an office. The flat rate is based on the hours you work from home. Calculate your allowable expenses using a flat rate based on the hours you work from home each month.

The simplified flat rate is a replacement for working out the proportion of personal and business use for you home in order to calculate how much of your utility bills are for business.

If your main business is carried out from home, it’s may be more tax efficient to apportion your utility bills based between personal and business use. The apportionment can on the basis of square footage occupied by business. However, you may use other apportionment bases if you’re using the same space for personal and business use.

Use of home as office

The flat rate allowance does not include telephone or internet expenses. These expenses can be claimed based on the business proportion of the actual costs incurred.

The simplified expenses is only available if you work for 25 hours or more a month from home.

Use of home as office – flat rate per month

25 to 50 £10
51 to 100 £18
101 and more £26

You worked 40 hours from home for 10 months, but worked 60 hours during 2 particular months:

10 months x £10 = £100
2 months x £18 = £36

Total you can claim = £136

Other helpful articles

How to find my UTR number

Tax calculators

You may be interested in our tax calculators below:

Income Tax Calculator
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CIS Tax Rebate Calculator

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