Self Employed: Can I Claim for the Cost of a New Laptop as a Business Expense?

Self Employed: Can I Claim a Laptop as a Business Expense

If you are Self Employed or a Freelancer the responsibility of delivering products or goods to your clients rest with you.  So any of the products and equipment you need to buy to achieve this will most likely be an allowable business expense and this probably will include your laptop or computer.

An Allowable Business Expense is a cost you have incurred in the course of doing your job or running your business.  HMRC describe these expenses as being ‘wholly, necessarily and exclusively’ incurred in the performance of your business.

Today, almost every freelancer or business will need a laptop so this will be an allowable business expense and save you tax (at 20% or 40% depending on your earnings) so claiming for this as a business expense makes good sense.  However if you do use your laptop for personal use, then you will only be able to claim for a portion of the cost.  For example: if you spend about 50% of your time on your laptop for personal reasons like shopping and Facebook then you will only be able to claim for 50% of the laptop cost against your income.

Your laptop will be claimed under the Annual Investment Allowance, which is a type of capital allowance, where you deduct 100% of the laptop against your self employment profits.

In addition, if you are VAT registered you will also be able to claim for the VAT on the laptop (again, the portion of VAT you can claim back will reflect your business use).

All business expenses must be supported by a receipt, so may sure you keep hold of all your paper or e mailed receipts. Furthermore any incidental costs of repairs or software may also be claimed as an Allowable Expense, so keep hold of all your receipts for discussion with your Accountant around Tax Time.

Related: A Guide Allowable Business Expenses

Previous articleTax Return for a Dormant Company
Next articleWhen is Corporation Tax Due
I'm a Chartered Accountant turned Blogger and I built this site to help self employed business owners grow profitable businesses by making the intimidating aspects of business and tax easy to understand with ‘How to’ Articles, Guides and Courses. Take a look around and you'll find all essential information you need to know to go self employed, launch a new venture and run a profitable business.