Business expenses: the receipt matters more than the amount
"Can I put this through the business?" is probably the most asked question among freelancers, and the one most often framed the wrong way. It is not the nature of the expense that decides, it is what you can demonstrate about it.
The three-question test
An expense is defensible if it passes all three:
- The purpose is professional. The expense serves to earn or keep your income. Not "it might come in handy": it serves.
- The proof exists. An invoice in your business name, legible, kept. A card slip proves a payment, not what was bought or for whom.
- The proportion holds up. An amount you would be comfortable justifying out loud to an inspector. If the explanation takes three embarrassed sentences, that is a signal.
Why the receipt comes first
A perfectly legitimate expense with no receipt is an expense you cannot defend. A modest expense with an impeccable receipt will never be a problem.
The practical consequence: the critical moment is not the tax return, it is the moment of purchase. A receipt not filed straight away is a receipt you will look for in vain.
Mixed use: the honest share
Phone, car, a room at home: many costs serve both lives. The rule is easy to state and uncomfortable to apply — only the professional share is deductible, and that share has to rest on something defensible, not on a round number picked because it sounds reasonable.
Capital goods or running costs
A computer that will serve you for years is not treated like a monthly subscription. The first is spread over time, the second is deducted in the year. Where the line sits, and how the spreading works, depends on your country — this is exactly the point to settle with your accountant rather than with a forum.
Keeping proof, and for how long
Every country imposes a retention period for supporting documents. It is longer than intuition suggests, and it runs from after the financial year concerned. Scan, file by year, and treat a lost receipt as a lost deduction.