How to Manage Business Expenses on the Go: A Practical Guide for UK Business Owners

/Published:9th April 2026/inBusiness, Expenses, Running a business, Software
Accounting Wise - How to Manage Business Expenses on the Go

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Keeping on top of business expenses has never been more important or, thanks to modern technology, more achievable. Whether you are a sole trader working across multiple sites, a limited company director travelling between client meetings, or an employer managing a team with regular out-of-pocket costs, the way you capture and record expenses directly affects your tax position, your cash flow, and your compliance with HMRC.

Yet many business owners still rely on paper receipts stuffed into wallets, end-of-month spreadsheets, and manual mileage logs that are difficult to reconcile and easy to lose. This post covers the practical tools and methods available to manage business expenses efficiently while you are away from the office, so that nothing is missed, records are accurate, and your accountant has everything they need come year-end.

Why Expense Management Matters

Business expenses reduce your taxable profit. If you incur costs that are wholly and exclusively for business purposes – as HMRC requires – they can be deducted from your income before your tax liability is calculated. For limited company directors, allowable expenses also reduce Corporation Tax. For sole traders and partnerships, they reduce the profits subject to Income Tax and National Insurance.

The problem is not usually a lack of eligible expenses. It is a failure to capture them accurately and in time. Receipts go missing. Mileage is forgotten. Business and personal spending becomes blurred. When records are incomplete, HMRC may disallow claims, leaving you with an avoidable tax bill.

Good expense management on the go solves this at the point the cost is incurred, rather than trying to reconstruct it weeks later.

What Counts as a Business Expense?

Before investing in any system, it is worth being clear on what qualifies. HMRC allows deductions for expenses that are incurred wholly and exclusively for business purposes. Common categories include:

  • Travel costs, including mileage, train fares, and parking
  • Accommodation and subsistence when away from your usual place of work
  • Business-related phone and broadband costs
  • Office supplies and equipment
  • Professional subscriptions and memberships
  • Entertaining clients (though client entertainment is generally not deductible for Corporation Tax purposes)
  • Tools, materials, and uniforms specific to your trade

For a full breakdown of what qualifies, GOV.UK provides detailed guidance on allowable expenses for the self-employed and for employees claiming tax relief on work expenses.

The Case for Going Digital

HMRC’s Making Tax Digital initiative is now live for Income Tax. From 6 April 2026, sole traders and landlords with qualifying gross income above £50,000 are legally required to keep digital records and submit quarterly updates to HMRC using compatible software. The threshold reduces to £30,000 from April 2027 and to £20,000 from April 2028. For VAT-registered businesses, MTD for VAT has been mandatory since 2022.

Adopting digital expense management now means your records are already structured correctly for MTD compliance, and your accountant has clean, categorised data to work with throughout the year rather than only at year-end.

Receipt Capture: Stop Losing Evidence of Your Costs

A valid receipt is essential for substantiating any expense claim. HMRC expects you to retain records for at least five years after the 31 January self-assessment submission deadline for sole traders, and for six years for limited companies. Keeping paper receipts for that length of time is impractical and carries obvious risks.

Modern receipt capture apps allow you to photograph a receipt the moment you receive it, extract the relevant data automatically using optical character recognition (OCR), and discard the paper original. HMRC accepts digital copies of receipts as long as they are legible and retained for the required period.

What to Look for in a Receipt Capture App

  • OCR accuracy: The app should reliably read supplier name, date, amount, and VAT details without requiring manual correction.
  • Cloud storage: Receipts should be stored securely in the cloud, not just on your device.
  • Integration: The app should connect directly to your accounting software so transactions are matched automatically.
  • VAT recognition: For VAT-registered businesses, the app should identify the VAT amount and rate to support reclaims.
  • Multi-user support: If you have employees submitting expenses, the app should allow multiple users under one account.

Popular Receipt Capture Options in the UK

Dext (formerly Receipt Bank) is widely used by UK accountants and integrates directly with Xero, QuickBooks, and Sage. It extracts data from photos, emails, and bank feeds and allows expenses to be categorised and submitted for approval.

AutoEntry offers similar functionality and is particularly useful for businesses that still receive paper invoices and statements alongside digital receipts.

Hubdoc is included with Xero subscriptions and automatically fetches bills and receipts from supplier accounts, reducing manual uploading.

Many accounting platforms, including Xero and QuickBooks, also have built-in receipt capture within their mobile apps, which may be sufficient if your expense volume is modest.

Mileage Tracking: One of the Most Commonly Underclaimed Expenses

Business mileage is one of the most frequently underclaimed expenses among self-employed individuals and company directors alike. The reason is straightforward: most people do not record their journeys at the time, and later estimates are difficult to defend if HMRC queries your return.

HMRC’s Approved Mileage Allowance Payment (AMAP) rates allow you to claim a flat rate per mile for using your own vehicle for business journeys. For the current tax year, the rates are:

  • Cars and vans: 45p per mile for the first 10,000 business miles, then 25p per mile thereafter
  • Motorcycles: 24p per mile
  • Bicycles: 20p per mile

These rates are intended to cover fuel, wear and tear, insurance, and other running costs. You cannot claim actual vehicle running costs separately if you are using the mileage rate. GOV.UK sets out the full rules on mileage payments.

For limited company directors who use a company vehicle, different rules apply, and you may need to report a benefit in kind on form P11D if there is any private use of the vehicle.

Mileage Tracking Apps Worth Considering

MileIQ runs in the background on your smartphone, automatically detecting when you are driving and logging each journey. You can then swipe to classify trips as business or personal. It produces HMRC-compliant mileage logs and integrates with some accounting platforms.

TripLog offers automatic mileage tracking, manual journey logging, and reporting tools. It supports multiple vehicles and is suitable for small teams.

Driversnote is a straightforward option that automatically records trips using GPS, allows you to set working hours so that only relevant journeys are tracked, and exports reports in a format suitable for submission to HMRC or your accountant.

Xero Expenses and QuickBooks both include basic mileage logging within their mobile apps, which is useful if you want everything in one place rather than using a dedicated app.

What Your Mileage Log Must Include

Whichever tool you use, your records should capture the following for each journey:

  • Date of travel
  • Start and end locations
  • Reason for the journey (business purpose)
  • Number of miles travelled

A log that contains only dates and distances is unlikely to satisfy HMRC in the event of an enquiry. The business purpose is a critical piece of information.

Expense Management Apps: An All-in-One Approach

If you are managing both receipts and mileage, and potentially reimbursing employees, a dedicated expense management app may be more practical than separate tools for each function.

Expensify is a well-established platform that covers receipt scanning, mileage tracking, approval workflows for employee expenses, and direct integration with accounting software. It is particularly useful for businesses with staff who travel regularly or incur frequent out-of-pocket costs.

Soldo takes a different approach by combining a prepaid company card with expense management software. Employees spend on the card, receipts are captured via the app, and transactions flow automatically into the accounting system. This eliminates the need for reimbursement in many cases and gives employers real-time visibility of team spending.

Pleo operates on a similar model to Soldo and has gained traction with UK small and medium-sized businesses. It issues smart company cards, captures receipts, and integrates with platforms including Xero, QuickBooks, and Sage.

Xero Expenses, included with certain Xero subscription tiers, allows employees to submit expense claims and mileage via the mobile app, which managers can then approve before the costs are posted to the accounts.

Managing Expenses with Balance

If you are an Accounting Wise client, you have access to Balance – our own cloud-based accounting software built specifically for UK small businesses. Balance includes built-in expense tracking, receipt capture, and bank feeds, allowing you to photograph receipts on the go, automatically import and categorise bank transactions, and keep your records organised and HMRC-ready throughout the year. Smart receipt matching links your uploaded receipts to the corresponding transactions, reducing manual reconciliation and keeping your books clean.

Balance also supports MTD VAT submissions directly to HMRC, making it a practical all-in-one solution for businesses that want to manage their finances without the cost or complexity of larger platforms. Packages start from £10 plus VAT per month, with a free version available for businesses that want to get started straight away.

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Integrating Expense Tools with Cloud Accounting Software

The real efficiency gain comes when your expense capture tools speak directly to your accounting software. Manual data entry between systems creates duplication, introduces errors, and adds time to an already administrative process.

Most leading expense apps integrate with the major UK cloud accounting platforms. When selecting tools, check for native integration with whichever platform your accountant uses. Common integrations include:

  • Xero: Integrates with Dext, Hubdoc, Expensify, Pleo, Soldo, and others via the Xero App Store
  • QuickBooks: Integrates with Dext, Expensify, and has built-in receipt capture via its own mobile app
  • Sage: Integrates with AutoEntry, Dext, and several other platforms
  • FreeAgent: Popular with sole traders and freelancers; includes receipt capture and mileage tracking within the app

When integration is set up correctly, a photographed receipt on your phone results in a coded, matched transaction in your accounting software with no manual intervention. Your accountant has accurate, categorised data ready for review, and you have a full audit trail if HMRC ever asks questions.

Managing Expenses as an Employer

If you have employees who incur business costs, you have additional obligations. Where you reimburse employees for allowable business expenses using HMRC’s approved rates such as the mileage rates above – there is no tax or National Insurance liability for either party, and no reporting requirement. Where you pay above the approved rates, or reimburse expenses that do not qualify as allowable, different rules apply.

Employers can apply for a PAYE Settlement Agreement (PSA) to cover minor or irregular expenses and benefits that are difficult to apportion between employees. This allows you to pay the tax on behalf of employees in a single annual payment rather than including each item on individual P11Ds.

For regular employee expense reimbursements, maintaining a clear expenses policy is essential. This sets out what employees can claim, the rates that apply, the evidence required, and the process for submission and approval. A written policy also helps demonstrate to HMRC that expense payments are controlled and that the business is not using expenses to make informal, untaxed payments to staff.

GOV.UK provides guidance on employer reporting requirements for expenses and benefits.

VAT Reclaims on Expenses

If your business is VAT-registered, many business expenses will include an element of VAT that you can reclaim on your VAT return. This makes accurate receipt capture even more important: you need a valid VAT receipt showing the supplier’s VAT registration number, the VAT amount, and the rate charged in order to make a claim.

Simplified VAT receipts (which do not show the customer’s name and address) are acceptable for purchases up to £250 including VAT. For anything above that threshold, you need a full VAT invoice.

Fuel is a common area where VAT reclaims are missed or incorrectly handled. If you pay for fuel on a company card or reimburse employees for fuel, you can only reclaim the VAT if you hold valid fuel receipts and the fuel is used for business purposes. If there is any private use element, HMRC’s fuel scale charges may apply.

Practical Tips for Staying on Top of Expenses

  • Capture receipts immediately. The habit of photographing a receipt before you leave the counter or pocket the paper eliminates the most common source of missing records.
  • Separate business and personal spending. A dedicated business bank account and, where appropriate, a business credit or prepaid card makes reconciliation straightforward and removes any ambiguity about which transactions are business-related.
  • Log mileage at the end of each journey. Even with an automatic tracking app, getting into the habit of confirming the business purpose while the journey is fresh avoids incomplete records.
  • Review your expenses monthly. A monthly check ensures that any uncategorised transactions are dealt with promptly rather than piling up at year-end.
  • Keep your accounting software up to date. Accurate, timely bookkeeping means your accountant can give you better advice and there are no surprises when it comes to tax planning or filing.
  • Talk to your accountant before implementing new tools. Your accountant will have a preferred workflow and may already recommend specific apps that integrate well with how they work. Choosing tools in isolation can create duplication or compatibility issues.

Final Thoughts on Managing Expenses on the go.

Managing business expenses on the go is no longer a matter of holding on to paper and hoping for the best. The combination of receipt capture apps, automated mileage tracking, and cloud-based accounting software means that expenses can be recorded accurately at the point they arise, integrated into your bookkeeping without manual effort, and made available to your accountant in a clean, auditable format.

The investment in the right tools pays dividends at tax time, through improved accuracy, fewer missed claims, and a process that stands up to scrutiny if HMRC ever asks questions. For businesses with employees, robust expense management also supports compliance with employer reporting obligations and reduces the administrative burden around year-end P11D submissions.

If you are unsure which tools are right for your business, or want to review whether your current expense processes are working as efficiently as they could, the team at Accounting Wise is here to help. We work with UK businesses of all sizes to put the right systems in place so that expense management is straightforward, compliant, and as close to effortless as possible.

Need help with your accounts and expenses? Contact Accounting Wise Today!

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Managing Expenses On The Go FAQ

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HMRC allows deductions for expenses that are incurred wholly and exclusively for business purposes. Common examples include travel costs, accommodation, business phone use, office supplies, professional subscriptions, and tools or materials specific to your trade. Client entertainment is generally not deductible for Corporation Tax purposes.

HMRC expects you to hold evidence for all expense claims. If a receipt is lost, try to obtain a duplicate from the supplier. A bank or card statement showing the payment may offer some supporting evidence alongside a note of the business purpose, but it is not a guaranteed substitute. Capturing receipts digitally at the point of purchase is the most reliable way to avoid this problem.

No. HMRC accepts digital copies of receipts provided they are legible and retained for the required period. Once you have a clear digital image stored securely in a cloud-based system, you do not need to keep the paper original. Make sure the image is of sufficient quality before discarding it.

HMRC’s Approved Mileage Allowance Payment rates allow you to claim 45p per mile for the first 10,000 business miles in a car or van, and 25p per mile thereafter. The rate for motorcycles is 24p per mile and for bicycles 20p per mile. These rates cover fuel, wear and tear, and other running costs, so you cannot claim actual vehicle expenses separately if you are using the flat rate.

No. Ordinary commuting between your home and your regular place of work is not a business expense. Business mileage covers journeys made for business purposes to locations other than your regular workplace, such as visiting a client site, attending a supplier, or travelling to a business event.

Sole traders and partnerships must retain records for at least five years after the 31 January submission deadline for the relevant tax year. Limited companies must keep accounting records for six years from the end of the accounting period. Records should include receipts, invoices, bank statements, and mileage logs.

Yes. If your business is VAT-registered, you can reclaim the VAT element on most business expenses, provided you hold a valid VAT receipt showing the supplier’s VAT number, the amount charged, and the VAT rate. For purchases up to £250 including VAT, a simplified receipt is acceptable. Above that threshold, a full VAT invoice is required.

HMRC does not formally endorse specific software, but it does accept digital records produced by expense apps as long as they are legible, complete, and retained for the required period. The tool you use matters less than whether the records contain the information HMRC expects, including dates, amounts, supplier details, and business purpose.

Glossary of Key Terms

Allowable Expense – A business cost that HMRC permits you to deduct from your income or profits, provided it is incurred wholly and exclusively for business purposes.

AMAP (Approved Mileage Allowance Payment) – HMRC's flat-rate mileage scheme that allows you to claim a set amount per business mile driven in your own vehicle, covering fuel, wear and tear, and running costs.

OCR (Optical Character Recognition) – Technology used by receipt capture apps to automatically read and extract data from photographs of receipts and invoices, such as supplier name, date, amount, and VAT.

Cloud Accounting Software – Web-based accounting platforms such as Xero, QuickBooks, Sage, or FreeAgent that store your financial records online, allowing access from any device and real-time integration with other tools.

Making Tax Digital (MTD) – An HMRC initiative requiring businesses to keep digital tax records and submit returns using compatible software. It currently applies to VAT-registered businesses and is being extended to Income Tax.

VAT Receipt – A receipt or invoice that includes the supplier's VAT registration number, the VAT amount charged, and the applicable rate. Required to reclaim VAT on business purchases.

P11D – A form submitted to HMRC by employers to report expenses and benefits provided to employees or directors that have not been taxed through payroll.

PAYE Settlement Agreement (PSA) – An arrangement between an employer and HMRC that allows the employer to make a single annual payment covering the tax and National Insurance on minor or irregular employee expenses and benefits.

Benefit in Kind (BIK) – A non-cash benefit provided to an employee or director, such as private use of a company vehicle, which may be subject to Income Tax and employer National Insurance.

Audit Trail – A complete, chronological record of all financial transactions and supporting documents, demonstrating that expenses are legitimate and accurately recorded. Essential in the event of an HMRC enquiry.

Prepaid Business Card – A company-issued payment card loaded with funds in advance, used by employees to pay for business expenses directly rather than using personal money and claiming reimbursement.

Reconciliation – The process of matching transactions in your accounting software against bank statements or card records to confirm that all income and expenditure is accurately captured.

Wholly and Exclusively – The legal test HMRC applies to determine whether a business expense is allowable. A cost must be incurred entirely for business purposes, with no personal element, to qualify for a full deduction.

Fuel Scale Charge – A fixed charge applied by HMRC when a company pays for fuel that includes an element of private use. It ensures the private fuel benefit is taxed appropriately rather than fully reclaimed as a business cost.
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