Running a startup is exhilarating, but when tax season comes around, founders often leave money on the table simply because they forget to deduct legitimate expenses. These missed write-offs can quietly eat into your cash flow and reduce the funds available for growth. While most entrepreneurs remember the obvious—like rent, salaries, and equipment—there are several overlooked expenses that could significantly lower taxable income.
Here are five of the most commonly forgotten deductions that every founder should be aware of:
1. Home Office Expenses
Many startup founders begin their journey from a spare bedroom, living room corner, or even the kitchen table. Yet, few take full advantage of the home office deduction. If you use a portion of your home
exclusively for business, you can deduct related expenses, including:
- A percentage of rent or mortgage interest
- Utilities such as electricity and internet
- Repairs and maintenance for that portion of the home
- Homeowner’s insurance
The key is to calculate the square footage used for business versus the total home size. For example, if your office takes up 10% of your home’s total space, you can deduct 10% of eligible home expenses. This deduction can add up quickly, especially in expensive cities where rent or mortgages are high.
2. Business Travel and Meals
Founders often travel for networking, investor meetings, client pitches, or industry events. While travel expenses are well known, many forget to track and deduct smaller, related costs, such as:
- Airport parking fees
- Ridesharing or taxi fares
- Hotel Wi-Fi charges
- Baggage fees
- Meals while traveling for business (typically 50% deductible)
Even local meals with clients, partners, or potential hires can qualify if the meeting is business-related. The IRS and most tax authorities expect detailed documentation, so keeping receipts or using apps to track business travel and meals is crucial. These small amounts, when accumulated over a year, can translate into significant tax savings.
3. Subscriptions and Digital Tools
Startups today rely heavily on digital infrastructure—yet many founders don’t think to deduct recurring online services. Whether it’s a $10 monthly design tool or a $200 project management platform, these subscriptions are legitimate business expenses. Common examples include:
- Project management tools (Trello, Asana, Monday.com)
- Cloud storage (Google Drive, Dropbox)
- SaaS products for accounting, HR, or marketing
- Website hosting and domain renewals
- Paid versions of Zoom, Slack, or Microsoft Teams
Since these costs often appear on personal credit cards or go unnoticed as “small” amounts, founders underestimate their impact. Tracking and categorizing them throughout the year ensures they’re captured as deductions.
4. Professional Services and Education
Founders frequently hire consultants, lawyers, accountants, or freelancers—but not all realize these costs are deductible. Fees paid for legal advice,
bookkeeping, marketing support, or even specialized contractors are all business-related expenses.
Additionally,
professional development is often overlooked. Founders constantly upskill through:
- Online courses (Coursera, Udemy, LinkedIn Learning)
- Industry certifications
- Seminars and webinars
- Trade publications or memberships
As long as the training is relevant to your business, it qualifies as a deductible expense. For example, if you run a tech startup and invest in a cloud security certification, those costs are fully deductible.
5. Business Use of Personal Assets
In the early stages, many founders blur the line between personal and business use. They use their
car, phone, or even personal laptop for both work and life. If a personal asset is used for business purposes, the corresponding portion of expenses is deductible.
Examples include:
- Car use – Mileage or actual expenses (fuel, insurance, repairs) for business trips
- Mobile phone bills – The percentage of usage dedicated to business calls, emails, and apps
- Personal laptop or computer – If purchased originally for personal use but now used for business, depreciation or fair value can be claimed
Founders often skip these deductions because they don’t want to “mix personal and business.” However, tax laws allow proportional deductions if expenses are properly documented. For instance, if 60% of your mobile usage is work-related, 60% of the bill can be deducted.
Why Founders Miss These Deductions
The main reasons founders forget these expenses include:
- Lack of tracking systems – Receipts and small expenses fall through the cracks.
- Using personal accounts – Subscriptions or bills paid from personal credit cards don’t get recorded as business costs.
- Fear of scrutiny – Some avoid deductions because they fear audits, even though these write-offs are fully legitimate when documented.
Implementing simple practices, like separating business and personal expenses, using expense-tracking software, and consulting with an accountant, can help capture every deduction.
Final Thoughts
For founders, every rupee or dollar saved in taxes is extra cash that can be reinvested into growth. While the big expenses are obvious, it’s often the smaller, overlooked deductions that make a noticeable difference at the end of the year. By remembering to deduct home office expenses, travel and meals, subscriptions, professional services, and the business use of personal assets, you can maximize savings and keep more money where it belongs—fueling your startup’s vision.
Being intentional about expense tracking and staying educated about tax rules can transform tax season from a stressful obligation into a strategic advantage.
