Home-based office costs £2,000 a year to run

A new study has underlined why contractors who work from home won’t want to miss out on tax relief when it comes to maintaining a dedicated office in their property.

In fact, the average cost of running a home-based office in the UK is as much as £2,000 a year, the equivalent of almost £45 a week (excluding 20 days’ holiday and national holidays).

The calculation, from flexible working giant Regus, indicates that the allowance of £4 a week that some home-based business people use to recoup running expenses is far from adequate.

More favourable, it seems, is the alternative model of claiming a proportion of expenses for use of their home as their office (as held under Section 34 of ITTOIA).

“The cost of furnishing a home office is substantial,” said Richard Morris, the UK chief executive of Regus, which came up with the £2,000 figure after polling 4,000 home workers.

But that cost is highest for staff whose employers let them work from home, as only 35% said their boss gave them a contribution to fit out a room in their property as an office.

Four in ten ‘permies’ are therefore cynical, saying the only reason most bosses want staff to work from home is just so they can try to shift the cost of a workspace onto the employee.  

Editor’s Note: Related Reading –

Contractors’ Questions: How much to claim for my home-based office?

Contractors’ Questions: Can I claim use of home as an expense?

Contractors’ Questions: Can home expenses still be claimed if I’m a ‘Ltd’?