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I am self employed working from home. I understand I can claim

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I am self employed working from home. I understand I can claim £4 per week to cover the cost of using my home office. Could I also claim a proportion of my gas and electricity cost and if so what would be the proportion? Thank you.

Hello and welcome to the site. Thank you for your question.

When you work from home, HMRC allow you up to £4pw and you don't have to provide any records of household expenses you are claiming relief for. This amount covers expenses associated with extra cost of gas and electricity to heat and light your work area.

If you work extensively from home and you have a room allocated as office then you would be able to claim extra expense toward light and heat based on proportion of work area in relation to total floor area of your property. You may be asked for evidence to support the additional charge.

More on tax relief for household expenses is covered here

http://www.hmrc.gov.uk/incometax/relief-household.htm

I hope this is helpful and answers your question.

If you have any other questions, please ask me before you rate my service – I’ll be happy to respond.

Customer: replied 4 years ago.


Thanks for the above response. I do work from home all the time and have a room allocated as the office. The house has 4 bedrooms + kitchen, lounge and dining room so would it be reasonable for me to divide the total amount spend on Gas & Electricity by the 7 rooms and using this as basis for the expenses claim?


 


Also on the link you kindly sent to me from the HMRC website it states that I cannot get relief 'on for expenses that relate to both business and private use - such as your telephone line rental, or Internet access'. The internet access is an integral part of my business as I spend a lot of time researching products and companies so it does not sound right that I cannot get relief on such charges? Where I live the mobile phone reception is not always reliable so I need the land line to ensure clients can contact me.


 


Can you please kindly advise if there is any specific way / proportion of charges I could claim relief on my line rental and broadband.


 


N.B. As far as I understand it is not possible to get the broadband connection without a land line so the cost for the internet is connected to the line rental.


 


Also, majority of the use of my mobile phone are for business so I assume I can get relief on these charges but please let me know otherwise.


 


Many thanks and kind regards, Monika

Monika, thank you for your reply.

[q]
Thanks for the above response. I do work from home all the time and have a room allocated as the office. The house has 4 bedrooms + kitchen, lounge and dining room so would it be reasonable for me to divide the total amount spend on Gas & Electricity by the 7 rooms and using this as basis for the expenses claim?

[a]
The above basis for working out light & heat expense would be reasonable.

[q]

Can you please kindly advise if there is any specific way / proportion of charges I could

claim relief on my line rental and broadband.


[a]
I work from home and runan accountancy practice. You could argue that the primary reason for havin a teelphone line is to have broadband for business and occasioanl private use is incidental. If I were you I would claim say 50%-75% as business expense. The same would apply to mobile phone.

I hope this is helpful and answers your question.


If you have any other questions, please ask me before you rate my service – I’ll be happy to respond.


Customer: replied 4 years ago.

Thanks for the information above but reading more on the internet I found that the Home Office relief calculation is based on the number of habitable rooms (exclude the kitchen and bathrooms) in the house so for me it would be 6 rooms and not 7.


I also note that I can claim a proportion of the mortgage interest repayment. Could you confirm what would be perceived as a reasonable calculation and if I should take into account that the mortgage is in my and my husband's name. Thanks in advance

Monika, thank you for your reply.

Your calculation for extra light and heat would be based on living rooms . and you are correct that this would be area of Room1/area of remaining 6 rooms.

As far as trying to claim for mortgage interest, I would stay away from it as you are exposing yourself to potential capital gains tax.

More information on this can be found here – look at “Using your home for business purposes”

http://www.hmrc.gov.uk/cgt/property/sell-own-home.htm#3


I hope this is helpful and answers your question.

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