Heat & Light Allowance for Office at Home

Justin_Credit · 5 March 2006 at 4:08PM

I am self-employed as a handyman working from home. I use my home as my office and am wondering how much of the electricity bill I can claim against tax.

I think I read that 10% is an accepted norm without getting into the possible deduction of capital gains tax if ever I sell my house but can't find anything written on it now.

I would like to claim more if I am allowed, say 15%, as I think it is warranted but not if I am at risk of paying CGT on the sale of the house, if I ever do that is.

I would welcome your ideas and suggestions.

Regards JC

TallTree · 5 March 2006 at 4:52PM

Can you claim back for internet usage and the phone bill too?

Justin_Credit · 5 March 2006 at 6:28PM

No TallTree I can't.

HMRC say that all I can claim is business phone calls which I must keep a record of, but I make so few it's not worth it. They wont let me claim the line rental as it is mainly for private use.

As for intenet usage, much the same I'm afraid, it isn't used for business very much at all.

I do use heat and light when doing my business admin though so would like to know what I could claim.

thanks JC

linlin_3 · 5 March 2006 at 8:45PM

You can claim the proportion of heat & light you justifiably use. So if total h&l costs = (say) £1000 for a 6 room house, and you use 1 room exclusively, you could claim one sixth. As you're likely to be working only (say) 50% of the total time the heat & light is in use, a more reasonable claim would be 50% of one sixth.
In addition, don't forget to claim "Use of Home as office" expenses......wear & tear of carpets; coffee; use of loo etc etc. Any decorating costs (for your office) are allowable, a percentage of any security alarm maintenance.
As regards telephone and internet use - as long as you don't claim rental costs, a reasonable percentage is usually acceptable. Of course, as a self-employed person, your mobile phone could be considered to be 100% business use!
Don't forget the protective clothing you can claim!

o_t_e · 5 March 2006 at 10:18PM

Hi - Linlins description of the method of calculating utility expenses is accurate. As long as you can justify that the expenses you are wishing to claim are legitimate business expenses, and they are not too excessive you should be fine - when you fill in the self assessment SA103 form you fill in two boxes - box 3.52 for the total household expenses, and box 3.34 for the proportion of those expenses you are not wishing to claim for - it looks more authentic if these aren't rounded up figures.

With regards capital gains the key thing is to ensure the room where you have your office is not exclusively for business use - as long as you have some non-business furniture in there - a guest bed, some home gym stuff etc then the inland revenue can't turn round and argue that a proportion of the sale value of your property should be subject to capital gains tax.

ps - have alook here: http://www.taxationweb.co.uk/taxdoctor/1.php

Heat & Light Allowance for Office at Home

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