As a business owner, along with phrases like ‘I've just put on a fresh pot’ and ‘Our profits are up,’ we're almost certain that three of your favourite words are ‘tax allowable expense.’ As business owners ourselves, those words are music to our ears. The thing is, most people understand the obvious ones: a laptop for digital nomads, a portion of the rent for those that work from home, and software subscriptions for graphic designers. However, we find that many our clients aren't aware of the more obscure allowable expenses that HMRC has no problem with you claiming.

So here are 10 unusual – yet permissible – expenses that you might not have considered.

1. Pet-Related Expenses

Okay, so you can't claim for your Yorkie that spends most of his day curled up in bed whilst you're out at work. However, if your pet plays a role in your business, such as a guard dog in a warehouse, their related costs can be deductible. This includes food, vet bills, and other necessary expenses to keep the animal healthy and active in their role within your business.

2. Decor and Artwork

If you purchase art or decor specifically for your office or business premises, these costs might be allowable. The key is that the artwork must be used by your business and be necessary for your business environment. This can be particularly relevant in spaces like restaurants or boutique hotels where ambiance is crucial.

3. Music Licenses

Many businesses play music as part of creating a pleasant atmosphere, whether in a retail shop, a restaurant, or at special events. The cost of music licensing fees, for platforms such as PRS, which are used to play music legally, are allowable expenses.

4. Personal Development and Well-being Programmes

Expenses for personal development for you and your team, such as stress management courses or life coaching, can also be deductible if they contribute to better business performance. Similarly, wellness programmes that promote general health can also be included if they potentially reduce business health costs.

5. Landscaping and Gardening

If the appearance of your business premises is important to attracting customers, then landscaping services could also be an allowable expense. This can apply to businesses like real estate where property appearance directly influences customer decisions, or retail shops where curb appeal matters.

6. Special Clothing or Funky Costumes

Costumes or special clothing required for your business that are not suitable for everyday wear are allowable expenses. This includes uniforms for staff or costumes for entertainment venues or themed restaurants.

7. Gifts

Business gifts are also deductible, but with limitations. The deductible amount is currently capped at £50 per recipient each tax year. This includes both physical gifts and expenditures like tickets to events as long as it is for a business purpose.

8. Moving Machinery

If your business needs to move equipment or machinery, the costs associated with the move are allowable. This can include hiring specialists to ensure equipment is safely transported and reassembled.

9. Environmental Upgrades

Investments made to improve the environmental efficiency of your business operations, such as the installation of some sparkling new solar panels or upgrading to energy-efficient appliances, are allowable. Plus, some of these expenses not only reduce your tax burden but might also qualify for additional governmental incentives!

10. Bank Fees

Many businesses overlook the deductibility of bank fees associated with business bank accounts or credit card charges. These fees can add up, particularly if your business transacts frequently.

Conclusion

While the usual suspects like travel expenses, employee salaries, and office supplies are well-known, the less obvious expenses can do a lot to bring down your tax obligation, meaning it's important you don't miss them. If you’d like to find out more about what business expenses are allowable in your business, then please get in touch with our team on 01709 589 439.