What is Self-Assessment? Self-Assessment is HMRC’s annual tax return process for people who need to report income that has not already been taxed. If you are not yet required to move to Making Tax Digital, Self-Assessment remains the standard route for declaring your income and allowable expenses.
Sole traders in the UK can claim certain business expenses on your Self-Assessment tax return to reduce your taxable profit. This means you only pay tax on the profit remaining after your allowable expenses have been deducted.
The key rule from HM Revenue & Customs is that expenses must be “wholly and exclusively for business purposes”.
