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Home Office, what percentage can you claim on tax return?

(15 Posts)
Walkthedinosaur Tue 12-Aug-08 19:41:13

I work 40+ hours a week from a home office and am just completing my tax return, does anyone know what percentage I can claim for my electricity, council tax etc? I can't find it on the HMRC website and it's impossible to ring the helpdesk during the school holidays because my DC's will just start making as much noise as possible as soon as I pick up the phone.

phraedd Tue 12-Aug-08 21:11:40

When I rang, I got told to take the number of rooms in your house and then use that as a percentage ie if you have 10 rooms in your house and you are using one of them, you can claim back 10% of your gas, electricty and water bill. Not the council tax though.

ChasingSquirrels Tue 12-Aug-08 21:24:38

if self employed see hmrc guidance (this page and onwards - next page link at the bottom).
I thought the council tax rules had been changed and you could now claim it.

if employed here and here

Eddas Thu 14-Aug-08 10:38:39

phraedd is right. But when couting the rooms don't inlcude the kitchen or bathroom. And we always include the coucil tax(I work for a chartered accountants)

So you can include, electricity, gas, council tax, insurance, erm think that's it but might be wrong!

JJAY2805 Mon 01-Sep-08 19:31:47

Just be careful and take advice from your accountant re claiming household expenses etc as a business expense as if you ever sell your house you could be liable for capital gains on the proportion you have claimed for. You may be okay if just claiming tele calls and electricity but if you say claim 'rent' of a room in your house you may be liable for capital gains.

catweazle Mon 01-Sep-08 20:56:49

If you are employed you cannot claim for water or council tax.

For 2006/07 onwards, the following expenses are not deductible in any circumstances.
Council Tax/rates

This is a flat rate charge which the employee has to pay irrespective of whether they work at home or not. No part of it is paid wholly and exclusively in the performance of their employment duties.

As for Council Tax.
Water rates

Water rates are a flat charge. So no part of the charge can be said to be incurred exclusively for business use. Where a water meter is used, see EIM32815.

catweazle Mon 01-Sep-08 20:58:40

nor insurance..


No deduction is due for the cost of insuring the property or any of its contents. It is not a cost that is incurred in carrying out the duties of the employment. It is an expense to save a later potential expense.

MrVibrating Wed 03-Sep-08 00:25:00

Steady on Catweazle, this is the 'Freelancers/Self Employed' topic, so your information about what employees can't claim is probably not what the OP is looking for.

There is no simple answer to the question 'what percentage can I claim' as you can see from the link provided by ChasingSquirrels to the HMRC guidance. However, if your home office is 1/10th of the living space of the house (kitchens, bathrooms etc. normally excluded) bathrooms and you don't use it for anything apart from work then 1/10th of all the household bills, including council tax and insurance, could be a good start point for a claim.

Incidentally, the reason HMRC give that domestic insurance cannot be claimed by an employee because it is 'an expense to save a later potential expense' is clearly rubbish. If that argument holds, then no insurance could never be claimed by anyone!

catweazle Wed 03-Sep-08 21:29:19

That's as maybe MrVibrating but it doesn't alter the fact that it is not a legitimate business expense because you'd have been paying it anyway. It doesn't become an expense linked to the business.

MrVibrating Wed 03-Sep-08 23:38:28

Not true catweazle, from BIM47820:

Fixed costs

Some costs relate to the whole house and have to be paid even if there is no business use. These include costs such as, Council Tax, mortgage interest, insurance, water rates, general repairs and rent.

If part of the home is set aside solely for business use for a specific period then a part of these costs is allowable. It will normally be appropriate to apportion these expenses by area and time.

catweazle Thu 04-Sep-08 19:13:46

OK may be allowed but still doesn't alter the fact that it isn't a business expense. While elsewhere on mumsnet the ethos is "I'd pay more tax for..." to benefit society, the self employed seem to be out to pay as little as possible. I wish the Govt would do something about it. (and I speak as someone whose RL friend got a brand new people carrier paid for by the taxpayer to carry her 5 children in by sign-writing it with the business name hmm) It is a pet hate of mine.

I shall stay out of this topic in future. It just makes me angry

Walkthedinosaur Tue 09-Sep-08 16:59:08

Thanks for everyone's advice much appreciated. I'm not out to pay as little as possible but just want to make sure that all legitimate expenses are covered.

Eddas Tue 09-Sep-08 20:12:46

catweazle calm down! IMO it is a legitimate expense. If you are an employee you are allowed to get cups of tea and use the loo. Why can't you claim part of your water bill if you work from home?

nowirehangers Tue 09-Sep-08 20:22:46

catweazle, the self employed don't get company pensions/maternity leave/health insurance, paid holidays to name some of the benefits employees have
Plus if big businesses are allowed to reclaim tax on expenses why the hell shouldn't small ones - otherwise they'd all go under. So please take a chill pill wink

nowirehangers Tue 09-Sep-08 20:24:48

btw, it's correct you can claim a percentage of the number of bedrooms on heat etc, ie if you have five bedrooms you can claim twenty per cet assuming you are using one as an office. Why the hell shouldn't that be deductible - we bought our house because it had room for an office for me and the room is only heated/lit etc because I am using it, plus your council tax is reflected in the size of your house so again a percentage of it seems a fair reflection

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