HMRC's simplified expenses let sole traders claim flat rates instead of working out exact costs for vehicles and working from home.
Mileage flat rates
| Vehicle | 2025/26 rate per business mile | From 6 April 2026 (2026/27) |
|---|---|---|
| Car or goods vehicle: first 10,000 miles | 45p | 55p |
| Car or goods vehicle: over 10,000 miles | 25p | 25p |
| Motorcycle | 24p | 24p |
Example for 2025/26: 12,000 business miles by car = 10,000 × 45p + 2,000 × 25p = £5,000. If you use flat rates for a vehicle, you can't also claim its actual running costs. Bicycles aren't covered by simplified expenses.
Working from home flat rates
| Hours worked at home per month | Flat rate per month |
|---|---|
| 25 to 50 | £10 |
| 51 to 100 | £18 |
| 101 or more | £26 |
Example: 60 hours a month, every month = 12 × £18 = £216 for the year. The flat rate doesn't cover phone and broadband, so claim the business share of those separately.
The £1,000 trading allowance
Instead of claiming expenses, you can deduct a flat £1,000 from your self-employment income. It's worth it when your real expenses are under £1,000. You can claim the allowance or your expenses, not both.
Tax rates for 2025/26
England, Wales and Northern Ireland: Personal Allowance £12,570; 20% up to £50,270; 40% up to £125,140; 45% above. Class 4 National Insurance is 6% on profits between £12,570 and £50,270, and 2% above. Scottish income tax rates are different.
Plan it in minutes
The spreadsheet calculates your mileage and use-of-home flat rates, checks whether the trading allowance beats your expenses, and estimates your tax.
See the Self Assessment Spreadsheet UK →