IT Contractor Expenses

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Claiming IT contractor expenses

As an IT contractor, you can maximise your take home pay by claiming for all your allowable business expenses.

Being self-employed means you can claim for many more types of outgoings than being on a payroll. And working through your own Limited Company is the best form of self-employment when it comes to accounting for expenses.

Our expenses guide for contractors gives you the information you need to help you keep your business outgoings as tax efficient as possible.

[Download the guide]

Minimising IT contractor tax

In the guide, you’ll find out what you can and can’t claim across a wide range of business expenses. Some of the areas we cover include:

  • travel and subsistence
  • mileage, parking and toll fees
  • business trips and accommodation
  • clothing
  • computers and IT equipment
  • training
  • memberships and subscriptions
  • journals and trade magazines
  • stationery
  • eye tests
  • telecoms
  • rent and utilities
  • advertising
  • pension contributions
  • professional services
  • company cars and entertaining

IR35 and IT contractor expenses

If your contract falls within IR35, you can’t claim daily subsistence or travel costs to your normal place of work. However, you can offset five per cent of your contract value for administration expenses. You don’t have to provide proof of this expenditure – it’s granted whether you spend it or not. It covers:

  • administration and secretarial services
  • professional services such as accountancy, legal and tax advice
  • computer equipment (if not eligible for capital allowances)
  • costs associated with winning business
  • hire purchase payments for business equipment
  • premises / office accommodation, including your home office
  • printing, postage and stationery
  • training
  • work related insurance policies

Beyond your five per cent administration allowance, you can also claim contractor expenses for travel and accommodation for work away from your client’s site, pension contributions and professional subscriptions.