AI agents for business finance: what they can and can't do
What AI agents can do in bookkeeping, close, collections and compliance today, where a person must stay in charge, and how to judge a product.
The short answer
A UK sole trader working from home for Nigerian clients can deduct allowable business costs such as stationery, phone bills, a share of household running costs and business travel, but only the business part of anything also used privately. GOV.UK says you need a reasonable method of dividing mixed costs, such as rooms used or time spent working. You cannot claim expenses at all if you use the £1,000 trading allowance instead.
The rule behind every claim
An expense is allowable if it is a cost of running the business. GOV.UK's guidance on expenses for the self-employed puts it simply: where something is used for both business and personal purposes, you can only claim allowable expenses for the business costs, and money you take out of the business for yourself is not an expense. Where the client is based makes no difference. A laptop used to design a website for a Lagos fintech is treated the same as one used for a client in Leeds.
One choice comes first. If your gross self-employed income is small, you can use the £1,000 trading allowance instead of claiming expenses, but not both. If your real costs are more than £1,000, claiming them usually gives the better result.
What you can usually claim
| Cost | How it is claimed | Note for work with Nigerian clients |
|---|---|---|
| Stationery, printing, postage | In full if for the business | Courier costs for signed contracts to Nigeria count |
| Phone and mobile bills | Business share only | Calls and data used with clients in Nigeria |
| Internet | Business share only | Video calls with clients across time zones |
| Heating, electricity, Council Tax, rent or mortgage interest | A reasonable share, or the flat rate | See the methods below |
| Software and subscriptions | Business share | Tools billed in dollars are converted to pounds |
| Business travel | Fares, hotels, meals on overnight trips | Client trips to Nigeria, if purely for business |
The phone, home and travel lines come from GOV.UK's expenses guidance; the notes in the third column are examples of how they apply. GOV.UK's travel guidance lists fares, hotel rooms, meals on overnight business trips and vehicle costs as allowable, and excludes non-business travel, fines and travel between home and a regular place of work. A trip to Lagos that mixes client meetings with a family wedding is at risk; see claiming a Nigeria work trip as a UK expense.
Working out the home share
There are two ways to claim household running costs.
1. A proportion of actual costs
GOV.UK lists heating, electricity, Council Tax, mortgage interest or rent, and internet and telephone use among the costs you may claim a share of, and says you need a reasonable method of dividing them, for example by the number of rooms you use or the time you spend working from home.
Example. Chidi rents a five-room flat and uses one room only as an office, working there 40 hours a week for UK and Nigerian clients. His heating and electricity for the year are £1,500. One room of five is 20%, so he could claim £300. If the room is also a guest room at weekends, he should reduce the share to reflect the time it is used privately.
2. The flat rate
If you work at least 25 hours a month from home, GOV.UK's simplified expenses let you claim a monthly flat rate based on hours worked, instead of working out a share of utility bills. Phone and internet are not included in the flat rate; you claim their business share separately. The rates and a worked example are in working from home: the flat rate for freelancers.
Costs that come from working with Nigeria
- Calls and data. If you call Nigerian clients on your mobile or use roaming data on a client trip, the business share of the bill is allowable. GOV.UK's example is a £200 mobile bill with £70 of business calls, of which £70 can be claimed. More in claiming phone and internet costs.
- Bank charges on client payments. Charges taken from an incoming payment from Nigeria reduce what you receive. Record the gross fee and the charge separately, so your income is not understated and your accountant can treat the charge correctly.
- Costs paid in naira. If you pay for something in Nigeria in naira, such as a local SIM or a co-working day pass on a business trip, convert it to pounds with the same method you use for naira income.
- Translation, certification or courier of documents a Nigerian client requires for a contract are business costs.
Records to keep
- Receipts and invoices for each cost, with the date and amount.
- Your bills for shared costs, with a note of the method you used to split them.
- A simple log of hours worked from home if you use the flat rate.
- For travel, the client meetings that justify each trip.
- Bank statements showing each payment, so a receipt can be matched to money leaving.
Keep each year's records together. If HMRC asks questions, a clear method applied the same way every year is easier to defend than a different estimate each time.
What you cannot claim
- Personal spending, including money you transfer to family in Nigeria from the business account.
- The private share of anything used for both business and home.
- Expenses at all, if you choose the £1,000 trading allowance for that year.
- Costs of a trip whose purpose was partly a holiday or family visit.
Where Pryme fits
Paying business costs from a separate business account makes the records far easier. A Pryme Business Account keeps pounds and naira apart, so naira costs on a Nigeria trip and pound costs at home each show on one statement, and you can export statements or generate receipts. The Finance agent prepares expense summaries for you to review. See business multicurrency accounts.
Questions people ask
Can I claim expenses for working from home as a freelancer?
Yes, the business share of costs such as heating, electricity, rent or mortgage interest, internet and phone, using a reasonable method of dividing them, or the flat rate if you work 25 hours or more a month at home.
Can I claim expenses and the £1,000 trading allowance?
No. GOV.UK says you cannot claim expenses if you use the trading allowance.
Are bank charges on payments from Nigeria an expense?
Record the gross fee and the charge separately and ask your accountant how to treat the charge; do not simply record the net amount as income.
Can I claim a trip to Nigeria to see clients?
Fares, hotels and meals on overnight business trips are allowable if the trip is for business. A trip that is also a holiday or family visit is at risk of being disallowed.
Sources
- GOV.UK: Expenses if you're self-employed, office, property and equipment (updated 8 Nov 2024) · accessed Oct 2026
- GOV.UK: Expenses if you're self-employed, travel · accessed Oct 2026
- GOV.UK: Simplified expenses, working from home · accessed Oct 2026
- GOV.UK: Tax-free allowances on property and trading income · accessed Oct 2026
This article is general information, not financial, legal or tax advice. Products described are provided under the terms on this site and are subject to regulation and eligibility.