Expenses Guidelines Limited Company

Her Majesty's Revenue and Customs (HMRC) allows genuine expenses that have been wholly, exclusively and necessary incurred in the performance of your duties, travel for providing services, subject to the 24 month rule.
Tax treatment of expenses does not depend on how you to choose to operate whether it be through a PAYE Umbrella Company or through a Limited Company solution.

Example of typical expenses by IR35 status

There are two types of expenses that contractors have:

1. Agency or end client chargeable

These are expenses that your agency or end client has agreed to reimburse your business. An example of this would be where you have to attend a meeting on their behalf and you have to pay for travel and hotel costs. The cost will then be reimbursed by either the agency or end client. This type of expense can be added to your business's services invoice or detailed on a separate invoice when submitted providing that this way of reclaiming expenses has been pre-agreed by the agency or end client.

2. Other expenses incurred by a Limited Company that are not chargeable

These are expenses that HMRC allow you to claim for, whilst incurred in the performance of your duties, and help reduce your overall tax liability.
The types of expenses that you are able to claim for are limited. Only expenses considered by HMRC that are not likely to give rise to any future tax and national insurance contributions are allowable. Your IR35 status will determine the type of expenses that you are allowed to claim.