Work from home? Make sure you know what expenses you can claim!

As someone who is self-employed and working from home even part of the time, there are many expenses that can be claimed to offset against your income at the end of the year. There are two ways in which these can be calculated. The first is a fixed rate method, which depends on how many hours per month you work at home. The second is more complex but allows all expenses to be apportioned and taken into consideration.

Let's first consider the flat rate method:

To qualify, you must be a sole trader or partnership with no companies as partners. You can claim the following:

  • 25-50 hours per month £10 claim

  • 51 – 100 hours per month £18 claim

  • 101+ hours per month £26 claim

The above values exclude telephone and internet costs so you will need to calculate these as a percentage usage of the total bill and add those amounts on.

The second more comprehensive method allows you to consider all expenses individually, which may work out more beneficial for you depending on your personal circumstances. Below I have listed the most common types.

The different expenses need to each be worked out in a reasonable and logical way. For example, you can count up how many rooms you have in your house, say 6, then if one of those rooms is used for work then a sixth of the total value of a particular expense could be claimed for business use. You can also allocate a percentage of the total usage for example with telephone and internet.

Fixed costs

  • Rent – you are not allowed to pay yourself rent but if you pay rent to a landlord then you can claim back a part

  • Council tax

  • Mortgage

  • House insurance

Running costs

  • Gas and electricity

  • Telephone and internet

  • Repairs – only when related to the specific room designated for work

  • Water – if metered. If not metered then water can be claimed as an expense if the type of work specifically requires water usage.

  • Cleaner

  • Fixtures and fittings specifically used for business use – for example, shelving, computer and printer

I recommend taking time to calculate your expenses of working from home using both methods. This way you can be sure that you are claiming back everything you are entitled to. If you would like help with your expenses then we would love to hear from you. Please call Rebus Bookkeeping on 07720910886.

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