Working from Home? Your guide to what you can and can’t claim…

There are a number of opportunities to obtain tax relief if you work from home.

These can vary substantially dependent on the amount of time you spend in your home office, the type of work you do or business you run, and whether you rent or own the home from which you work.

Claims can be made for costs incurred that are directly attributable with your work area or any services used – common examples would include business telephone calls or the extra cost of gas and electricity for your work area within the home.  Please download our INFORMED Guide to Expenses for more about what business expenses you might be able to claim.

The ability to claim tax relief if you work from home is dependent upon records being maintained sufficiently to prove and support any claim for relief, so please don’t hesitate to contact us should you need any support or advise as to how to do this.

Please also be aware however, that if  the costs incurred cover both private and business use within the home, for example broadband access, then only a proportion of tax relief can be claimed in certain circumstances.

Alternatively, HMRC have provided an allowance of up to £4 per week where there is no need to provide evidence of expenses incurred.

This is designed to provide some simplicity for home workers and avoids the complication of maintaining separate billing records for what might be quite small areas of the home from which business is undertaken. Whilst this may seem a relatively small tax benefit, do remember that every small amount soon adds up. For a 40% taxpayer the relief on the total flat rate use of home allowance of £208 per annum equates to a tax saving of £82.20 in a very simple and risk free manner – certainly better off in your pocket than that of HMRC in our opinion!