When you are running a small business from home, controlling costs is one of the fastest ways to protect profit without raising prices. With inflation, energy bills and wage costs still squeezing margins in 2026, spending discipline matters more than ever. For self-employed women in the UK, keeping a tight grip on outgoings is essential if you want to build a sustainable business on your own terms.
Cost control is not about refusing to spend. It is about making sure every outgoing earns its place. Here are five practical tips for controlling costs so you can keep more of what you earn.
1. Claim the home working expenses HMRC allows
If you work from home, you can claim a proportion of household costs against your tax bill. HMRC offers a simplified flat rate of £6 per week, which covers heating, electricity, council tax and mortgage interest or rent. That is £312 a year you can deduct without keeping detailed receipts. The rate has been set at this level for several years and is available to both sole traders and directors who work from home.
If your costs are higher, you can claim the actual business proportion instead, but you will need records to back it up. Other allowable expenses include office equipment, stationery, phone and internet use, and professional subscriptions. For a full breakdown of what counts, see our guide to home working expenses you can claim through HMRC.
2. Renegotiate broadband, mobile and energy contracts
Telecoms and energy are two of the biggest fixed costs for home-based businesses, and both reward shoppers who switch or haggle. Ofcom rules require broadband and mobile providers to tell customers when their contract ends and to show the best available deals, but you still need to act. A difference of just £15 a month between broadband packages adds up to £180 a year, enough to cover a professional subscription or a day of childcare.
Energy is equally important. Ofgem’s energy price cap limits the unit rate suppliers can charge, but the actual bill depends on usage. A home office with computers, lighting and heating running all day can easily push consumption above typical household levels. Check your usage, compare business and domestic tariffs, and consider a smart meter to spot waste. If you are eligible, look at schemes such as the Energy Company Obligation or local council grants for insulation and efficient appliances.
3. Plan for wages, National Insurance and the National Living Wage
If you employ staff, payroll is likely your largest cost. The National Living Wage is reviewed every April, and National Insurance and pension auto-enrolment contributions add to the total, so build them into your cashflow forecast before you hire. Check the current rate on GOV.UK before you update your budgets, as underpaying the minimum wage can lead to fines and being named by HMRC.
If you use contractors, check your IR35 status carefully, as getting it wrong can lead to backdated tax bills and penalties. Even if you work alone, paying yourself efficiently matters. For limited company directors, the balance between salary and dividends affects income tax and National Insurance.
4. Use digital tools to cut admin and accountancy bills
Manual record-keeping is not just risky; it is expensive. From April 2026, HMRC’s Making Tax Digital for Income Tax Self Assessment requires self-employed people and landlords with turnover above £50,000 to keep digital records and submit quarterly updates. Those with turnover between £30,000 and £50,000 must join from April 2027.
Cloud accounting software can automate invoicing, expense tracking and bank reconciliation, saving hours each month. Free or low-cost options are available for small businesses, and the time saved often pays for the subscription many times over. For sole traders, our Making Tax Digital checklist for self-employed women sets out what you need to prepare.
5. Cut waste before you cut value
The cheapest option is not always the best. A £90 printer with £40 ink cartridges will cost more over two years than a £200 laser printer with toner that lasts thousands of pages. The same logic applies to software, furniture and professional services. Buying better quality once is often cheaper than replacing cheap items repeatedly.
Start by auditing your last three months of spending. Group costs into essential, useful and optional. Cancel subscriptions you no longer use, challenge automatic renewals, and ask suppliers for loyalty discounts. If you are VAT registered, remember the VAT registration threshold remains at £85,000 until April 2028, so crossing it changes your pricing and paperwork.
Your next steps for controlling costs
- Review your last three months of business spending and cancel anything unused.
- Check whether you are claiming the right HMRC home working allowance.
- Compare broadband, mobile and energy tariffs before your contract renews.
- Update your cashflow forecast to reflect the latest National Living Wage and National Insurance rates.
- Choose MTD-compatible accounting software if your turnover is above £50,000.
Controlling costs is a habit, not a one-off exercise. By checking your outgoings regularly and using the allowances and tools available, you can keep your business lean without sacrificing the quality your customers expect.
