Use of home - What is the difference between these two links?

[amarkitanis]

I'm trying to understand the difference between these two links:

HM Revenue & Customs: Tax relief for household expenses when working at home

https://www.gov.uk/simpler-income-ta...e-of-your-home

The first website mentions a flat rate of £4 per week or £18 per month and does not mention any sort of hours worked from home.

The second one has different bandings depending on the number of hours you spend at home or just generally doing any work in a month.

Are they referring to two different expenditures you can claim?

[SueEllen]

What did your accountant say you can claim?

[amarkitanis]

What did your accountant say you can claim?

If he had said something, I wouldn't have come here!

[northernladuk]

Time to get a new accountant then.

[TheDandy]

If he had said something, I wouldn't have come here!

Did you ask him?

[philip@wellwoodhoyle]

The first relates to employees (including company directors), the second relates to self employed (i.e. sole traders).

[TheCyclingProgrammer]

As above, and note that it is possible to claim more than the flat rate of £4 but you would need to provide evidence that what you are reimbursed reflects the additional cost (note: additional which means you couldn't apportion your rent or home broadband for example, but you could possibly claim increased utility costs if you can demonstrate it).

Generally it's easier to just claim the flat rate. If you work from home a lot it might be possible to form a rental agreement with YourCo and charge it rent for use of the space but this needs to be discussed with your accountant first so they can explain the potential issues that could arise from this if it isn't done properly.

[jamesbrown]

Aside from the simplicity of claiming the standard allowance, it's actually quite unlikely that you would exceed this standard allowance (in any meaningful way) by applying the rules of apportionment to your actual costs (which do not include rent or mortgage payments). I've been through this, and it just isn't worth the effort - my calculations amounted to roughly the same as the standard allowance and I work 100% from home. You could always knock through the walls and create one big room, I suppose

Further, you want to avoid the scenario where you have a dedicated office space, as that potentially leaves you liable to business rates and loss of PPR (CGT) relief on the sale of your property (perhaps unlikely to be enforced). In other words, it's important that the home office space is dual purpose or potentially so.

[GillsMan]

Further, you want to avoid the scenario where you have a dedicated office space, as that potentially leaves you liable to business rates and loss of PPR (CGT) relief on the sale of your property (perhaps unlikely to be enforced). In other words, it's important that the home office space is dual purpose or potentially so.

My accountant advised me to ensure that there was a duality of purpose to the office space, for example, by having a bed or sofa in it, to avoid being liable for business rates. In my case, when I had an office at home, my office did double up as a spare bedroom on occasion outside of office hours.

[TheCyclingProgrammer]

My accountant advised me to ensure that there was a duality of purpose to the office space, for example, by having a bed or sofa in it, to avoid being liable for business rates. In my case, when I had an office at home, my office did double up as a spare bedroom on occasion outside of office hours.

I've also read you can get around this by only renting for 5 days a week and specifying so in the rental agreement. It seems a bit of a grey area to me?

This is my accountant's information on charging YourCo rent if anybody is interested:
http://jf-financial.co.uk/2013/05/03...-company-rent/

Does anybody know how PRR could be affected if you use an outbuilding instead? E.g. bought a garden studio or converted a detached garage? Would either be considered part of your property and does it have to be considered part of your property to affect PRR? I suspect that technically an installed garden studio wouldn't technically be part of your property as it wouldn't be a permanent structure but the garage would.

jamesbrown: I thought you could include mortgage interest costs or rental costs when calculating and apportioning your costs.