Professional indemnity insurance is tax deductible. Business insurance, including professional indemnity insurance, counts as an ‘allowable expense’, which means it’s a cost you can deduct when you’re calculating your taxable profit.
When you’re calculating your taxable profits for your tax return you can subtract business expenses from your income.
Allowable expenses include certain travel costs, property costs, and legal and financial costs like your professional indemnity insurance premium. Other types of business insurance are also tax deductible.
You should keep a record of all your business income and expenses so that you can accurately calculate your taxable profits and also so that you have evidence of your calculations if HMRC conducts a check on your business. When you buy your business insurance, be sure to keep your receipt and your policy documents safe.
If you hire an accountant to complete your tax return, remember to tell them how much you paid for your professional indemnity insurance so that they can include this cost as an allowable expense when they’re making their calculation.
We recommend that you take professional advice when you are making any important tax-related decisions.
At Simply Business we insure all kinds of trades like:
Is your profession not listed? When you run a quote you can select your trade from over 1,000 options.
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