Is That A Business Expense?
As a creative business owner, staying on top of your finances might feel like a chore, but it’s essential for long-term success. We know there are so many things to consider, but one common area of confusion is what counts as a business expense…?
Let’s walk you through the essentials so you can avoid any unpleasant surprises when tax season rolls around.
What Counts as a Business Expense?
Simply put, a business expense is anything necessary to run your business—from rent, staff salaries, advertising costs to software subscriptions.
Tracking these expenses is vital, not just for keeping your business running smoothly but also for maximising your tax deductions.
Why Proper Tracking Matters
Failing to keep an accurate record of your expenses can lead to chaos—both in your accounts and your tax return.
By keeping everything organised, you’ll have a clear view of your cash flow and can make better decisions about the future of your business.
Common Deductible Expenses for Creative Businesses
Knowing what’s deductible can save you a significant chunk of change. Here are some key categories you can claim:
Running Expenses: Rent, utilities, office supplies, software, and business rates.
Employee Costs: Salaries, National Insurance, Pensions and even staff training.
Travel Costs: Client meetings, industry events, and business trips.
Marketing: Digital advertising, website fees, and even free samples for promotion.
Professional Fees: Accountant, legal, or membership fees.
Avoid Common Mistakes
Avoid mixing personal and business expenses, overstating deductions, or ignoring small expenses can all lead to higher tax bills or, worse, HMRC investigations.
Keep things separate, track everything, and don’t overlook the small stuff. It all adds up!
Get Help!
Mastering your business expenses isn’t just about saving on your tax bill, it’s about setting up your business for growth and financial stability.
At Scotch Accounting, we know the creative industries inside out and can help you manage your finances effectively—so you can focus on what you do best: creating.
