Using Your Home as an Office

Using your home as an office can provide significant tax savings if you work from home for your business. Understanding HMRC's rules is essential to claim expenses correctly and avoid penalties.

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How Home Office Expense Claims Work

HMRC allows you to claim a portion of your household costs if you use part of your home exclusively for business purposes. This is based on the idea that you're incurring additional costs for heating, lighting, and other utilities.

The key is establishing a clear and regular pattern of working from home. Occasional use might not qualify, but if you have a dedicated home office space or work from home frequently, you can likely make a claim.

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What Home Office Expenses You Can Claim

HMRC permits various costs to be claimed when using your home as an office. Here's a comprehensive list of allowable expenses:

A proportion of your heating and electricity bills based on the time and space used for business.
A share of your council tax, mortgage interest, or rent if you have a dedicated office room.
Internet and phone costs for business calls and usage, excluding personal use.
Home insurance premiums for the business portion of your home.
Repairs and maintenance costs for the office area, such as painting or fixing leaks.
Cleaning costs specifically for the office space.
Furniture and equipment, like desks and chairs, if used exclusively for business.
Business-related software subscriptions and online services.
Postage and stationery used solely for business purposes.
Professional fees related to setting up or maintaining your home office setup.

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Common Mistakes and When to Seek Advice

A common mistake is claiming for personal use areas or not keeping adequate records. HMRC requires evidence that the space is used regularly and exclusively for business. Mixing personal and business use can invalidate your claim.

If your home office usage is complex, such as if you have multiple business activities or high-value claims, it's wise to get professional advice. Accountants like Edward Harris in Oldham can help ensure you're claiming correctly and maximizing your allowable expenses without risk.

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