The Complete Guide to Tradesperson Overheads in the UK

Overheads are the costs of being in business — the money you have to spend whether you're working or not. For most self-employed tradespeople, overheads represent between £8,000 and £20,000 per year, and every penny needs to be recovered through your day rate or job pricing.

Understanding your overheads is not just about accounting — it's the foundation of pricing correctly. If you don't know what it costs to run your business, you can't know whether you're making money.

This guide breaks down every major overhead category, with typical figures for UK tradespeople in 2025/26.

Van and Transport Costs

For most tradespeople, the van is the single biggest overhead — and it's often underestimated. The mistake is to think of van cost as just the monthly finance payment. In reality, the full cost includes:

Here's a realistic breakdown for a mid-range trade van doing 18,000 miles per year:

Use our Van Cost Calculator to get a precise figure for your specific van, mileage, and finance arrangement. The calculator also shows your van cost per billable day — a more useful figure when quoting jobs.

Tools and Equipment

Tool costs vary enormously by trade:

• Painter and decorator: £500–£1,000/year (brushes, rollers, dust sheets, ladder maintenance)
• Plasterer: £800–£1,500/year (hawk and trowel replacement, float maintenance)
• Plumber: £1,200–£2,500/year (pipe tools, testing equipment, specialist kit)
• Electrician: £1,000–£2,000/year (testing equipment, hand tools, ladders)
• Builder / groundworker: £2,000–£4,500/year (power tools, hand tools, safety equipment)
• HVAC engineer: £2,000–£4,000/year (refrigerant recovery equipment, leak detectors)

When calculating tool costs, use a replacement cycle approach: estimate the lifespan of each major item and divide the cost across that period. A £600 SDS drill that lasts three years costs you £200/year, not £600 in year one and zero afterwards.

Insurance

Public Liability Insurance

Covers you if you injure someone or damage their property while working. Not legally mandatory but expected by most clients and required by most trade bodies. Typical cover: £2–£5 million. Annual cost: £300–£800 depending on trade, turnover, and claims history.

Employers' Liability Insurance

Legally required if you employ anyone (including labour-only subcontractors in some circumstances). Minimum cover: £5 million. Cost: £400–£1,500 per year depending on your workforce. If you work entirely alone with no employees, you don't need this.

Tools and Equipment Insurance

Covers theft or damage to your tools, including from your van overnight. Cost: £150–£400/year. If you have high-value tool inventory, this is worth the premium — an overnight van break-in can cost £5,000+ in replacements.

Professional Memberships and Registrations

Many trade memberships are either legally required or expected by customers. Key ones by trade:

Professional Services

An accountant is one of the best investments a self-employed tradesperson can make. A good accountant typically saves significantly more than their fee through tax-efficient expense claims, timing of purchases, and avoiding HMRC penalties.

Typical costs for sole traders:

• Basic self-assessment filing: £300–£600/year
• Full bookkeeping and tax return: £600–£1,200/year
• VAT registration and quarterly returns: Add £300–£500/year

Invoicing and accounting software (QuickBooks, FreeAgent, Xero) costs £15–£35/month. Some accountants include software access as part of their fee.

Phone and Communications

If you use your personal phone entirely for business, you can claim 100% of the cost. If it's mixed use, HMRC allows you to claim the business proportion — typically 50–80% for most tradespeople. A business-only SIM makes the accounting simpler.

Workwear and PPE

Workwear with your business name on it is a legitimate advertising expense. PPE is an essential cost of the job and fully deductible. Safety equipment — harnesses for scaffolders and roofers, respirators for plasterers — can add £500–£1,000 to this figure.

Training and Certification

Many certifications have 3–5 year renewal cycles. Amortise these across the period rather than counting the full cost in a single year:

• CSCS card (Green or Blue): £36 renewal every 5 years (~£7/year)
• IPAF (Powered access platforms): ~£200 per 5-year renewal (~£40/year)
• First aid at work: ~£200 per 3 years (~£67/year)
• Gas Safe ACS renewal: ~£300–£600 every 5 years

Marketing and Business Development

Marketing costs vary enormously. Some tradespeople get all their work through word of mouth and spend nothing. Others invest heavily in online presence and paid directories. Key costs:

• Website hosting: £50–£200/year
• Van signwriting: £150–£800 (amortised across van lifespan)
• Trade directories (Checkatrade, Rated People, TrustATrader): £200–£800/year
• Google Ads: variable, but £50–£300/month is common for local trades

Overhead Totals by Trade

Using typical figures, here's how annual overheads break down across different trades in the UK:

Are Overheads Tax Deductible?

Yes — most genuine business expenses are allowable deductions against your taxable income for self-assessment purposes. HMRC's rule is that expenses must be "wholly and exclusively" incurred for business purposes.

Allowable expenses typically include:

• Van costs (actual costs or HMRC mileage rate — you can only use one method per vehicle)
• Tools and equipment (under AIA for full deduction in year of purchase)
• Professional memberships and registrations
• Accountant and professional fees
• Phone and broadband (business proportion)
• Work clothing and PPE (but not everyday clothing that could be worn outside work)
• Training directly related to your trade
• Public liability and professional indemnity insurance

The key point is that your overheads reduce your taxable income, not just your pre-tax income. If you're paying 20% income tax, a £1,000 expense costs you £800 in real terms after tax relief. Always keep receipts and run all business expenses through a proper accounting system.