Side hustle expenses you can claim in the UK (2026/27)
What expenses you can claim against side hustle income: allowable costs, the flat rates for working from home and mileage, when the trading allowance is better, and the expenses HMRC will not accept.
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Expenses or the trading allowance?
Every year you choose between:
- The trading allowance: knock £1,000 off your income (£3,000 from April 2027), no receipts needed.
- Your actual expenses: knock off what you really spent.
You cannot have both. Add up your costs: if they are less than the allowance, take the allowance.
Free toolSide hustle tax calculatorSee how much tax and National Insurance you owe on side income, and what to set aside each month.What you can claim
| Cost | Can you claim it? |
|---|---|
| Stock you buy to sell, and materials to make products | Yes |
| Selling and payment fees (Etsy, eBay, PayPal, card readers) | Yes |
| Postage, packaging and delivery costs | Yes |
| Equipment like a laptop, camera or tools | Yes, the business share |
| Phone and broadband | Yes, the business share |
| Software, apps and subscriptions you use for the work | Yes |
| Advertising, website and domain costs | Yes |
| Insurance for the business | Yes |
| Training to improve skills you already use in the business | Yes |
| Accountant fees | Yes |
Things you cannot claim
- Everyday clothes, even if you wear them to work (uniforms and protective kit are fine)
- Your normal commute to a regular workplace
- Fines, such as parking tickets
- Entertaining clients
- Personal shares of mixed costs
Simplified expenses: flat rates
Instead of working out exact costs, you can use HMRC's flat rates.
Working from home
| Hours worked from home in a month | Flat rate per month |
|---|---|
| 25 to 50 | £10 |
| 51 to 100 | £18 |
| 101 or more | £26 |
Source: GOV.UK simplified expenses. You only claim for months where you worked at least 25 hours at home.
Business mileage
| Vehicle | Rate per business mile |
|---|---|
| Car or van, first 10,000 miles | 55p |
| Car or van, after 10,000 miles | 25p (35p from April 2027) |
| Motorcycle | 24p |
If you use the mileage rate, you cannot also claim fuel, insurance or repairs for that vehicle.
Mixed use: claim the business share
If something is used for both personal and business reasons, like your phone, claim only the business part. A fair method, for example the share of calls or hours, is fine. Write down how you worked it out.
Keep records
You must keep records for at least five years after the 31 January deadline for that year. Photos of receipts are fine. A spreadsheet or bookkeeping app makes the tax return quick and is required if you join Making Tax Digital.
Free toolMaking Tax Digital checkerFind out if and when you need MTD software and quarterly updates for your side income or rent.Common questions
Can I claim my laptop as a side hustle expense?
Yes, the share you use for the business. If you use it half the time for your side hustle, claim half the cost.
Can I claim expenses without receipts?
You need evidence, but bank statements, emails and order confirmations can help. Flat rates for mileage and working from home need a log rather than receipts.
Can I claim the trading allowance and mileage?
No. The trading allowance replaces all expenses, including mileage. Pick whichever gives the bigger deduction.
This is general information, not personal tax or financial advice. Tax rules change and depend on your circumstances, so check GOV.UK or speak to an accountant before acting.