Use of Home as an Office

you basically have three options:

  • Claim £4 per week (£3 per week before 6 April 2012, and £2 per week before 6 April 2008).
  • Claim for the extra costs of gas and electricity as a result of using your home for work; as well as business phone calls and internet usage.
  • Set up a formal contract for the rental agreement between yourself and your company for the space used for business. Please note that the rental income has to be declared in your personal tax return, and beware of the possible CGT implications.

Requirements for claiming use of home: use of home must be wholly, exclusively and necessarily for business purposes ; it should be a requirement for you to work from home, and not merely a convenience; you can only claim for performance of duties that earn money for your service company; you should only claim for the additional costs incurred as a result of using your home for work; your contract should not specify that duties have to be carried out on client premises, or taking work off site. Ideally the contract with your client should require you to work from home.