How JustAnswer Works:

  • Ask an Expert
    Experts are full of valuable knowledge and are ready to help with any question. Credentials confirmed by a Fortune 500 verification firm.
  • Get a Professional Answer
    Via email, text message, or notification as you wait on our site.
    Ask follow up questions if you need to.
  • 100% Satisfaction Guarantee
    Rate the answer you receive.

Ask TonyTax Your Own Question

TonyTax
TonyTax, Tax Consultant
Category: Tax
Satisfied Customers: 15841
Experience:  Inc Tax, CGT, Corp Tax, IHT, VAT.
13905389
Type Your Tax Question Here...
TonyTax is online now

There, income and expenses calculations, how

Resolved Question:

Hi there,
for rental income and expenses calculations, how much can I reasonably claim as an expense for minor use of home as office. I only have one property which I rent out and spend a small percentage of time managing. Can I treat telephone and broadband costs separately from say a standard use of home as office rate of £4 per week or would HMRC consider them to be included?
many thanks for your assistance
Richard
Submitted: 1 year ago.
Category: Tax
Expert:  TonyTax replied 1 year ago.
Hi.

Can you tell me exactly what you have done over 8 years as far as managing your property accounts is concerned given that you have never declared the income and there is only one let property. Have you ever had an agent manage the letting? How long does this administrative work take per week?
Customer: replied 1 year ago.

I'm in touch with HMRC about this. I have bank statements and receipts for some but not all expenses pre-2010 but an agent managed the property thereafter. I calculate I made a net loss up until year ending 5th April 2012. The administrative work including responding to agent queries regarding maintenance etc probably takes up a few hours a month. Before the agent took over in 2010 it took up a bit more time as I had to go and sort things out and spend much more time dealing with repairers etc. I maybe averaged 4-5 hours of my time per month averaged over the year.

Expert:  TonyTax replied 1 year ago.
Thanks.

Leave this with me while I draft my answer.
Customer: replied 1 year ago.

I have also had to travel to the property which is in Sheffield (I live in Norwich) so I have estimated up to three journeys a year for mileage before the agent took over management. So I guess the time spent actively managing the property by physically going there versus the time sat at home on the phone to agents (hence use of home as office) has to be kept distinct? Sorry for follow-up question but I hope it helps clarify the issue

Expert:  TonyTax replied 1 year ago.
Hi again.

Given that you are dealing with earlier years and none of this has been disclosed even if you never made a profit, HMRC will look at any claims for expenses they consider spurious.

Use of home as office is really only used by the self-employed and employees on occasion. I have clients with rental profits and I never claim use of home as office. You certainly cannot claim an hourly rate for your time.

Take a look here for information on the regular types of letting expenses that can be claimed. You should then read through the notes for the self-employed claim for use of hoem as office from BIM47800 to BIM47825 starting here and the notes specific to property income here.

You can claim for travel costs where they are incurred wholly and exclusively for the purposes of the rental business. Unless you can break down your phone bills between calls specific to the letting and any others, then you will have a problem if HMRC query such a claim. As I said above, I would never claim for use of home as office unless property management is all that the client does but you could try putting through a claim for, say, £2 per week for use of home as office.

I hope this helps but let me know if you have any further questions.
TonyTax, Tax Consultant
Category: Tax
Satisfied Customers: 15841
Experience: Inc Tax, CGT, Corp Tax, IHT, VAT.
TonyTax and other Tax Specialists are ready to help you

What Customers are Saying:

 
 
 
  • Wonderful service, prompt, efficient, and accurate. Couldn't have asked for more. I cannot thank you enough for your help. Mary C.
< Previous | Next >
  • Wonderful service, prompt, efficient, and accurate. Couldn't have asked for more. I cannot thank you enough for your help. Mary C.
  • This expert is wonderful. They truly know what they are talking about, and they actually care about you. They really helped put my nerves at ease. Thank you so much!!!! Alex
  • Thank you for all your help. It is nice to know that this service is here for people like myself, who need answers fast and are not sure who to consult. GP
  • I couldn't be more satisfied! This is the site I will always come to when I need a second opinion. Justin
  • Just let me say that this encounter has been entirely professional and most helpful. I liked that I could ask additional questions and get answered in a very short turn around. Esther
  • Wonderful service, prompt, efficient, and accurate. Couldn't have asked for more. I cannot thank you enough for your help. Mary C.
  • This expert is wonderful. They truly know what they are talking about, and they actually care about you. They really helped put my nerves at ease. Thank you so much!!!! Alex
 
 
 

Meet The Experts:

 
 
 
  • Sam

    Sam

    Accountant

    Satisfied Customers:

    7088
    26 HMRC expertise, PAYE, Self Assessment ,Residency, Rental Income, Capital Gains, CIS ask for Sam Tax
< Previous | Next >
  • http://ww2.justanswer.com/uploads/TA/Tax Expert/2013-8-21_231010_sam.64x64.jpg Sam's Avatar

    Sam

    Accountant

    Satisfied Customers:

    7088
    26 HMRC expertise, PAYE, Self Assessment ,Residency, Rental Income, Capital Gains, CIS ask for Sam Tax
  • http://ww2.justanswer.com/uploads/BI/bigduckontax/2013-8-12_222058_1.64x64.jpg bigduckontax's Avatar

    bigduckontax

    Accountant

    Satisfied Customers:

    2333
    FCCA FCMA CGMA ACIS
  • http://ww2.justanswer.com/uploads/TA/TaxRobin/2013-8-28_16186_femalebusinessprofessionalbinderhand11038485.64x64.jpg TaxRobin's Avatar

    TaxRobin

    Tax Consultant

    Satisfied Customers:

    524
    International tax
  • /img/opt/shirt.png taxadvisor.uk's Avatar

    taxadvisor.uk

    Chartered Certified Accountant

    Satisfied Customers:

    2845
    FCCA - over 35 years experience as a qualified accountant (UK based Practitioner)
  • http://ww2.justanswer.com/uploads/MS/MsAM/2012-6-9_16426_anna.64x64.jpeg Anna's Avatar

    Anna

    Teacher, writer, biologist

    Satisfied Customers:

    270
    Great research skills, variety of work experiences, teaching experience.
  • http://ww2.justanswer.com/uploads/PD/pdheslin/2012-6-6_232056_pambig.64x64.jpg pdheslin's Avatar

    pdheslin

    Consultant

    Satisfied Customers:

    51
    20+ years of internet site creation and search engine optimization. Dozens of search tools at my disposal.
 
 
 

Related Tax Questions