Expenses You Can Claim as a Limited Company Director (2025 Update)
Running a limited company comes with plenty of responsibilities, but one of the biggest advantages is being able to claim legitimate business expenses. Done properly, this reduces your company profit and lowers the amount of Corporation Tax you pay. The trick is knowing what you can claim, what you cannot claim, and what HMRC is very particular about.
This 2025 guide breaks everything down in simple language so you can stay compliant and make the most of the reliefs available to you.
What Counts as a Valid Business Expense
HMRC has a simple test. The expense must be wholly and exclusively for business.
If an expense has a personal element, or you would have spent the money anyway, HMRC will not let your company claim it. When in doubt, always ask the question:
Would I have paid for this if I was not running my business?
If the honest answer is no, it is usually allowable.
Common Expenses Directors Can Claim in 2025
1. Office Costs
These include things your company needs to function day to day.
Examples
Laptops
Phones
Office chairs and desks
Software subscriptions
Stationery
If you use the item for both business and personal use, the company should only claim the business portion.
2. Business Travel
Travel must be for business reasons.
Examples
Train tickets
Taxis
Mileage when using your personal car
Hotels when travelling for work
Food when you are working away from your normal workplace
Your normal commute does not count. Going from home to your regular office is never an allowable expense.
3. Working From Home Expenses
If you work from home, you can claim a proportion of your household costs.
These include
Gas and electricity
Council tax
Rent
Internet
There are two ways to claim
Use HMRC’s flat rate
Claim a fair percentage of your real costs
4. Professional Fees
Anything that supports the running of your company is usually allowed.
Examples
Accountancy fees
Legal advice
Business coaching
Professional memberships
If the membership gives you personal perks not related to your work, you cannot claim it.
5. Training and Courses
Training must be directly related to your existing role.
This means you can claim for
Courses that improve your current skills
Training that updates your knowledge
You cannot claim for training that teaches you a completely new trade.
6. Marketing Costs
All your efforts to promote the business are allowable.
Examples
TikTok ads
Google ads
Website costs
Branding
Photography
Email marketing software
7. Business Insurance
Any insurance that protects the company is valid.
Most directors claim
Professional indemnity
Public liability
Employer’s liability
8. Staff Costs
If you employ people or outsource work
Salaries
Subcontractors
Payroll software
Employer pension contributions
Your own salary is also a deductible expense.
9. Company Vehicles
If the company owns the vehicle, running costs can be claimed.
This includes
Fuel
Repairs
Insurance
Servicing
If it is a car, there can be personal tax charges, so always take advice first. Commercial vehicles are usually much simpler.
10. Entertainment
This is the one everyone gets wrong.
You can claim
Client entertainment
Staff entertainment up to the annual event allowance
You cannot claim director entertainment. HMRC sees this as a personal cost.
Expenses You Should Be Careful With
Some areas trigger HMRC interest if not handled correctly.
These include
Mobile phones
Director loans
Home office costs
Company cars
Payments to yourself that are not salary or dividends
A quick chat with an accountant can save a lot of stress later.
The Golden Rule for 2025
Keep records.
Invoices.
Receipts.
Bank statements.
If you ever face an HMRC enquiry, good records are your protection.
Want to Make Sure You Are Claiming Everything Correctly?
If you want help making sure you are claiming the right expenses and not missing out on tax relief, book your free call here 📞
I will walk you through everything step by step so you can keep more of your money and stay on the right side of HMRC.