Which Self Assessment Expense Box Should You Use?

If you are a sole trader completing your Self Assessment tax return, accurately reporting your business expenses is essential. HM Revenue and Customs (HMRC) requires you to enter your allowable expenses in specific boxes on the Self Assessment form, primarily in the Self Employment (full) section if you report using the SA103 form.

Understanding Expense Boxes for Sole Traders

When completing your Self Assessment tax return, you will usually use the SA103S (short) or SA103F (full) supplementary pages for self-employed income and expenses. These forms have designated boxes for different types of expenses. Using the correct box ensures HMRC can process your return correctly and calculate your taxable profit.

Common Expense Categories and Their Boxes

• Box 17: Cost of goods bought for resale or raw materials – Use this box if you purchase goods or materials to sell on or use in producing your products.
• Box 18: Other allowable business expenses – This is a general box for most expenses that do not have a specific box, such as office costs, phone bills, or advertising.
• Box 19: Business premises costs – Include rent, business rates, utility bills, and repairs related to your business premises here.
• Box 20: Motor expenses – Use this box for vehicle costs used for business purposes, including fuel, insurance, repairs, and servicing. You must only claim the business proportion of these costs.
• Box 21: Travel expenses – This covers travel costs such as public transport fares, accommodation, and meals when away from your normal place of business (excluding vehicle costs which go in Box 20).
• Box 22: Clothing expenses – Claim here only for necessary uniforms or protective clothing, not everyday clothes.
• Box 23: Staff costs – Wages, salaries, and benefits paid to employees go here.
• Box 24: Advertising or business entertainment costs – Advertising, marketing, and entertaining clients or customers should be included here.
• Box 25: Financial costs – Bank charges, interest on business loans, and similar costs belong here.
• Box 26: Bad debts – If you have debts you cannot recover, enter those amounts here.
• Box 27: Professional fees and subscriptions – Accountancy fees, legal fees, and professional subscriptions related to your trade should be included here.
• Box 28: Depreciation and capital allowances – Do not enter depreciation here; instead, claim capital allowances separately in the capital allowances section of the tax return.

Practical Examples

If you run a small gardening business and buy plants and seeds to sell or use, enter the cost in Box 17. If you pay rent for a shed used solely for your business tools, include this in Box 19. Business travel on public transport to a client’s property goes in Box 21. If you use your personal car for business journeys, you can claim actual business mileage costs in Box 20 or use simplified expenses based on approved mileage rates.

Important Notes

• Keep detailed records and receipts for all expenses you claim, as HMRC may request evidence.
• Only include expenses that are wholly and exclusively for your business. Personal costs cannot be claimed.
• Some expenses, such as capital purchases (equipment, vehicles), are not entered as expenses but claimed through capital allowances.
• If you use simplified expenses (flat rates for certain costs such as vehicle mileage or home office use), report these amounts in the relevant boxes.

For specific guidance on which boxes to use for your particular expenses, consult the official Self Assessment notes for the SA103 form or HMRC’s detailed guidance. This ensures you report correctly according to the latest rules.

Official reference: https://www.gov.uk/self-assessment-tax-returns. Always check the latest official guidance. Related forms: Browse our form category.

Important: This article provides general information. Government rules, forms and procedures can change, and this article may not reflect the latest updates. Check current GOV.UK guidance or the relevant authority before relying on it. ITG & Co. is independent and is not affiliated with a government department.