Deductible Business Expenses for the Self-Employed

Deducting legitimate business expenses is one of the most direct ways to reduce your tax. The key is knowing what qualifies as business-related.

What you can deduct

Expenses that are necessary for your business and documented: software, hardware, office rent, professional fees, insurance, travel for work, and marketing are all typically deductible.

The governing test is business necessity. If the expense exists because of the business, it is generally deductible; if it exists anyway, it is not.

Deductible items reduce your net income, which is what you are actually taxed on. Every legitimate franc deducted is a franc not taxed.

Examples across most freelancers include subscriptions, hardware, professional advice, insurance and the business share of phone and internet.

• Software, hardware and office equipment.
• Office rent and utilities.
• Professional, legal and insurance fees.
• Business travel and marketing.

What you cannot

Private expenses are not deductible, and mixed-use items (a phone or car used partly for private life) must be apportioned to the business share.

Personal living costs — rent on your home, groceries, private travel — are never deductible, regardless of how you frame them.

For mixed-use items, only the business percentage is deductible. The split must be reasonable and consistent from year to year.

Some expenses, like certain entertainment or personal clothing, are typically disallowed even when loosely connected to the business.

Document everything

A receipt alone is not always enough; the business connection should be evident. A note on the receipt explaining the purpose helps if questions arise.

Digital copies are fully accepted, so scan or photograph receipts immediately. The habit is worth more than the perfect system.

Organise expenses by category and by tax year. When the tax office asks, you want to hand over a tidy folder, not a shoebox.

Getting the most from deductions

Review your expenses quarterly and categorise them as you go. Catching a deductible item late is better than missing it entirely.

Know the specific rules for your field. Some professions have particular deductions, and a tax advisor can spot ones you are missing.

Do not inflate or invent expenses. The tax office sees many returns and recognises patterns; the risk is never worth the small saving.

facturio records your business expenses alongside your income, so the deductible picture for your tax return is always current and complete.