Not every receipt belongs in the business accounts and that’s where your bookkeeper comes in.
It’s easy to push expense tracking to the bottom of the to-do list. You buy something, keep the receipt and think, “I’ll let the bookkeeper sort it out.” At AMR Bookkeeping, we don’t just enter receipts into your accounts. We look at what you’re claiming and flag anything that doesn’t look like a genuine business expense. We do this to help keep your records accurate and your business on the straight and narrow.
What counts as a business expense?
You must incur an expense wholly and exclusively for the purposes of your
business to be allowable. Where something has both a business and personal element, you may only be able to claim the business proportion. To find helpful HMRC information on different expenses
please click here. Expenses bookkeepers commonly flag
Here are some of the most common expenses that cause confusion:
- Your everyday clothes. Even if you wear them to work, ordinary clothing is generally not a business expense. Specialist, protective or clothing with your business logo on can be different.
- Personal meals and coffees. Grabbing lunch because you’re working doesn’t automatically make it a business expense. Business travel and qualifying business meals are subject to specific rules.
- Family or personal expenses. School fees, shopping or household purchases don’t become business expenses just because they were paid from the business account.
- Gym memberships. Staying fit and healthy may help you run your business, but you can’t claim your gym membership as a business expense.
- Haircuts and grooming. Looking professional is important, but your normal haircut isn’t generally an allowable business expense.
- Personal subscriptions. Netflix, Spotify and other subscriptions used mainly for personal enjoyment shouldn’t be put through the business. Even if you sometimes listen or watch while working.
- Home improvements. Decorating the kitchen or buying a new sofa doesn’t become a business expense simply because you work from home.
- Personal travel. Your normal journey between home and work isn’t business mileage. Business journeys need to meet the relevant rules.
- Entertainment. Taking clients out for dinner or drinks might be good for relationships, but business entertainment has specific tax rules and isn’t automatically deductible.
- Mixed-use purchases. If something is used for both business and personal purposes, we may need to split the cost rather than claim the whole amount.
And yes, sometimes we’ll ask you: “What was this actually for?” That’s not us being difficult. It’s us doing our job!
What about mileage?
Mileage is another area where keeping good records matters.
For the 2026/2027 tax year, the simplified business mileage rate for cars and vans is 55p per business mile for the first 10,000 miles, reducing to 25p per mile after that. Motorcycles are 24p per mile. The important word here is business. You need to keep a record of your business journeys and ordinary private journeys – such as travelling from home to your regular workplace – doesn’t qualify under the simplified mileage rules. If you’re using the mileage method, the mileage rate is intended to cover the running costs of the vehicle, including things such as fuel, insurance, servicing, repairs and depreciation. You can’t simply claim the mileage rate and then add all those vehicle running costs again. That’s why keeping a proper mileage log is so important.
Why having a bookkeeper helps
It’s easy to assume that if something has been paid for from your business bank account, it must be a business expense. It isn’t. Part of our job is to spot the things that don’t look right, ask questions when we’re unsure and make sure your accounts reflect what’s genuinely happening in your business. We’re not here to stop you claiming legitimate expenses. Quite the opposite – we want to make sure you claim everything you’re entitled to, while avoiding claims that could cause problems later.
Not sure whether something is a business expense? Ask us before you claim it.
It’s much easier to check it at the time than try to untangle it later.
