Sole Earnings.
UK freelancer expense calculators and tax guides.

Simplified expenses rules

Quick answer

HMRC simplified expenses let sole traders use flat rates for home office (£10-£26/month), vehicles (mileage allowance), and living-in costs (if you live on business premises). You can use simplified expenses for some categories and actual costs for others, but not both for the same category in one tax year.1

What are simplified expenses

Simplified expenses are flat-rate deductions that replace tracking actual costs. They're designed to reduce admin burden for small businesses. You don't need receipts or apportionment calculations.1

Categories

Home office

  • 25-50 hours/month: £10/month
  • 51-100 hours/month: £18/month
  • 101+ hours/month: £26/month

Vehicles

Use AMAP rates: 55p/25p for cars, 24p motorcycles, 20p bicycles. This counts as simplified expenses (you cannot claim actual running costs).

Living in business premises

If you live above a shop or pub, you can claim a flat rate for private use adjustment.1

When to use simplified expenses

Best for: low hours from home, minimal vehicle use, simple tax affairs. Not best for: high household costs, high mileage, expensive leases.

Limits

You can switch between simplified and actual costs each tax year, but not mid-year. Once you choose, you're locked in for that tax year.1

Sources

  1. HMRC (2026). Simplified expenses. gov.uk (accessed 10 July 2026)

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