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Business Premises Q&A Forum Post: Tax deductible expenses for home-based businesses Q) How much can I claim as tax deductible if I am operating my business from home? Answered by Clive Lewis, ICAEW, The expenses claimed against income for Income Tax purposes must be “wholly and exclusively” for the purposes of the trade or business. So for a business run from home a proportion of the expenses of the residence used for business, such as a study/ office, surgery or workshop can be charged against profits. Provided a discrete room or space is for the business, it is usual to calculate the proportion of the house occupied by the business and charge the appropriate percentage of council tax, heating and lighting, etc to the business. If a shared telephone is used the business proportion can be charged to the business. You should also notify the local authority so that they can assess whether the business use of the house makes you liable to business rates on the room(s) used. You should also notify your household insurance company and mortgage provider to ensure they are aware that a business is operating from the house. There are currently no comments on this post. Leave a comment
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