Claimable Expenses for Construction Businesses: The Full List

Zubair Aslam
1 day ago
6 min read

Updated: 15 hours ago

Key Takeaways

Allowable expenses are the business costs you can deduct from your income before tax — and claiming them in full is what turns overpaid CIS into a refund.
To count, a cost must be "wholly and exclusively" for your business — for mixed personal-and-business costs, you claim only the business share.
Common claims for subbies include tools, protective clothing, vehicle and mileage costs, insurance, phone, materials, use of home, and professional fees.
The simplified mileage rate rose to 55p per mile for the first 10,000 business miles from 6 April 2026 (25p thereafter) — up from 45p.
Ordinary everyday clothing and commuting to a permanent workplace are not allowable, so it's worth knowing where the line sits.

Allowable expenses for a CIS subcontractor are the day-to-day business costs you can deduct from your income before your tax is worked out — tools, vehicle costs, insurance, protective gear, and more. They matter more under CIS than for most trades, because CIS is deducted from your gross labour before any costs are counted. Claiming every allowable expense lowers your taxable profit, which is exactly what turns the tax you've overpaid through CIS into a refund.

The "wholly and exclusively" rule

HMRC's core test is simple to state: an expense is allowable only if it's incurred wholly and exclusively for the purposes of your business. A hammer bought for work qualifies; the weekly food shop doesn't. Where a cost is part business and part personal — your mobile phone, for instance — you claim only the business proportion. Keep that test in mind and most expense questions answer themselves.

Allowable expenses for construction businesses

Here are the costs subcontractors most commonly claim:

Tools and equipment

Hand tools, power tools, and small equipment used for work are allowable. Larger, longer-lasting equipment is usually claimed through the Annual Investment Allowance, which for practical purposes means most subbies can still deduct the full cost in the year they buy it.

Protective clothing and safety gear

Hi-vis, steel-toe boots, hard hats, gloves, knee pads, and other personal protective equipment (PPE) are allowable. Branded workwear carrying your business name also qualifies. Ordinary clothing does not — more on that below.

Vehicle and travel costs

You can claim for using your vehicle for work in one of two ways: the simplified mileage rate (55p per mile for the first 10,000 business miles, then 25p — see the note below), or a share of your actual running costs (fuel, insurance, servicing, repairs) based on business use. You pick one method per vehicle and stick with it for as long as you own that vehicle. Travel to temporary sites is generally allowable; ordinary commuting is not.

Insurance

Public liability insurance, tools/equipment cover, and other genuine business insurance are allowable. These are among the most commonly forgotten claims.

Materials and consumables

Materials you pay for, along with consumables like fixings, blades, and sundries used on jobs, are allowable business costs.

Subcontractors and labour you pay

If you pay your own subcontractors or labourers, those payments are a business cost — remember that CIS then applies to you as a contractor, so you must verify and deduct correctly.

Phone and internet

The business proportion of your mobile, landline, and broadband is allowable. If you use your phone 70% for work, you claim 70% of the cost.

Use of home as an office

If you handle quotes, invoicing, and admin from home, you can claim a share of your household costs. The simplest route is HMRC's flat rate: £10 per month for 25–50 hours of business use, £18 for 51–100 hours, and £26 for 101 hours or more. Alternatively, you can work out the actual business proportion of your bills.

Accountancy and professional fees

Accountant's fees, bookkeeping, and other professional costs relating to your business are allowable — including the cost of preparing your accounts and tax return.

Training

Training that maintains or updates skills you already use in your business is allowable. Courses to acquire an entirely new trade or qualification are treated differently and may not be, so this is an area to check.

Subscriptions, cards and levies

Your CSCS card, relevant trade body memberships, professional subscriptions, and the CITB levy where it applies are all allowable business costs.

Admin and other costs

Bank charges on a business account, stationery, printing, accounting software, and genuine advertising or marketing for your business are all allowable.

Note: the mileage rate changed in April 2026

From 6 April 2026, HMRC's simplified mileage rate for cars and vans increased from 45p to 55p per mile for the first 10,000 business miles in the tax year, with 25p per mile applying above that. It's the first increase since 2011 and a genuine boost for subcontractors who clock up serious mileage between sites. If you're preparing a return for the 2025/26 tax year, you use the old 45p rate for that year; the 55p rate applies from 2026/27 onwards.

The £1,000 trading allowance

If your total business expenses for the year come to less than £1,000, you can claim the flat £1,000 trading allowance instead of adding up your actual costs — whichever gives you the bigger deduction. You can't claim both the trading allowance and your actual expenses, so it's an either/or choice, and it mainly helps subbies with very low costs.

What you can't claim

These are the traps that catch subcontractors out:

Ordinary everyday clothing — jeans, t-shirts, general workwear — even if you only wear it on site. Only genuine PPE and branded workwear qualify.
Commuting to a permanent workplace. Travel between sites and to temporary sites is normally fine, but travelling to the same single site for a very long, continuous period can be treated as ordinary commuting and disallowed. This grey area catches a lot of subbies, so it's worth having a construction-specialist accountant check how your travel should be treated.
The private share of any mixed-use cost — you claim the business proportion only.
Fines and penalties, including parking fines and HMRC penalties.
Client entertaining, which isn't an allowable deduction.
Double-claiming — you can't claim mileage and actual fuel for the same vehicle.

How to actually claim your expenses

Claiming is straightforward if your records are in order:

Keep every receipt and a mileage log. No record, no claim — so hang on to receipts and note your business journeys as you go. Digital record-keeping is increasingly expected by HMRC, so a simple app or spreadsheet pays off.
Total your expenses by category for the tax year.
Claim them on your return — sole traders through Self Assessment, limited companies against Corporation Tax — alongside the total CIS deducted from your payments.
Keep your records for at least five years after the Self Assessment filing deadline, in case HMRC asks.

Frequently Asked Questions

What expenses can I claim as a CIS subcontractor? The business costs you incur wholly and exclusively for your work — typically tools and equipment, protective clothing, vehicle and mileage costs, insurance, materials, the business share of your phone and home use, professional fees, relevant training, and trade subscriptions. Claiming them lowers your taxable profit, which increases the refund of overpaid CIS you're likely due.

Can I claim for my van and tools? Yes. Tools and equipment used for work are allowable, and larger items are usually fully deductible through the Annual Investment Allowance. For your van, you can claim either the simplified mileage rate or a business-use share of your actual running costs — but you must stick to one method per vehicle.

Can I claim mileage or fuel as a subcontractor? Either, but not both for the same vehicle. The simplified mileage rate is 55p per mile for the first 10,000 business miles (25p thereafter) from 6 April 2026, and it replaces claiming actual fuel and running costs. Alternatively, you claim the business proportion of your real costs. Keep a mileage log whichever you choose.

Can I claim for my work clothes? Only protective and branded workwear. Hi-vis, safety boots, hard hats, and gloves are allowable, as is clothing carrying your business name. Ordinary clothes — jeans, t-shirts, general trousers — are not allowable even if you only ever wear them for work, because HMRC treats them as everyday clothing.

Does claiming more expenses increase my CIS refund? Yes. Because CIS is deducted from your gross labour before any costs, the more allowable expenses you claim, the lower your taxable profit and the larger the refund of overpaid CIS. Two subcontractors on identical income can get very different refunds depending on how thoroughly they claim.

Make sure you're claiming everything

Under-claimed expenses are the single most common reason subcontractors leave money with HMRC. Every allowable cost you miss shrinks your refund. Try our free CIS rebate calculator to estimate what you're owed, or talk to the SiteLedger team on 0161 513 0027. As construction-industry specialist accountants, we always look for ways to increase your refund.

Written by the SiteLedger team — construction-specialist accountants. Last reviewed: July 2026. Figures and rates apply to the 2026/27 UK tax year (with the 2025/26 mileage rate noted where relevant). This is general guidance, not personal tax advice; your position depends on your circumstances, so speak to us about your specific business.