I am currently employed full-time in the UK as a graphic designer, I have a salary of £30K, I have also registered myself as a sole trader as I occasionally take on freelance work in my spare time (designing logos and artwork for print and web) I bring in no more than £3K a year from this extra work, this work is completed from a room in my house using my own equipment.

Currently 20% of the £3K income is deducted as tax, am I legally allowed to offset this against anything related to this work? For example Electricity bills or equipment?

Thanks you for your time.


1 Answer 1


Yes, you can deduct from your taxable profits (almost) any expenses incurred in the course of your business. See here for HMRC's detailed advice on the subject. The fact that you have salaried PAYE employment as well makes no difference.

  • HMRC may consider £3K income to be a hobby and hence not allow the cost of computers etc to be deducted. (So can't offset the cost of a new mac every year.)
    – Ian
    Commented Apr 28, 2016 at 13:55
  • @Ian But if they regard it as a hobby then the £3K of income is not taxable at all.
    – Mike Scott
    Commented Apr 28, 2016 at 14:02
  • 1
    The income can be taxable as it is income from a trade, but using equipment that the HMRC says was brought for the hobby. So if only 10% of the mac usage is for the trade, don't try to claim 100% of the cost of buying it.
    – Ian
    Commented Apr 28, 2016 at 14:06

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