Required to have home office

AnxiousMum

jiggy2 wrote: »

do you rent or own the property?

if you own - using one room exclusively for "business use" would result in you not getting principal private residence relief for capital gains purposes

As mentined earlier Jiggy - we had to rent a 4 bedroom house rather than a 3 bedroom - as I needed a room for an office. I know it's easy to miss little things like that in posts! I do it all the time

PlutoinCapricorn

You are very wise not to try to "push your luck" at a time when companies are trying to keep costs down, and other workers have been using their facilities for non-work purposes.

I don't want to rain on your parade, but I think that unless the company told you in advance that if they took you on you must have a separate office, and you said at the time that this would mean renting a bigger place, I am not sure that you can claim any expenses for it. I quite understand that you need a space of your own, but this is your choice.

I believe that HMRC prefer that employees who elect/are required to work at home should try to negotiate with the employer before they approach HMRC. You could try to get the basic HMRC-approved £3 per week allowance, at any rate.

We are behind Canada with its vast spaces, where working from home seems to be quite normal. However, HMRC have realised that home working is becoming more and more common, and are working on the rules. The whole issue is being re-packaged to reflect the reality: the allowance was £2 in recent years. I have found the following, where rent is excluded:


Checklist
What additional household expenses can a home working employee reclaim from their employer?

• Light and heat
• Business rates - if charged, not council tax
• Internet access - subject to above
• Insurance - if additional insurance is taken out
• Telephone calls (not line rental)
• Cleaning - if extra cleaning is required
• Metered water

A homeworking employee cannot reclaim mortgage interest, rent, council tax, standing water charges or line rentals. S 316 does not allow claims where there is dual private benefit or use, and this rules out most decorating costs. An employer may install and pay for in full a business telephone line or internet access.

AnxiousMum

Thanks again Pluto. With regards to the rent - I agree, that was my choice. But then I also have the luxury of sitting out by the pool on a nice sunny day, using wireless internet and phones and conducting my business in the sunshine sipping on an iced tea. So....there's lots of perks to working from home - in my little break from the screen every hour, run and put in a load of laundry, vacuum a bedroom.....cook a proper lunch. I'm not going to quibble about a room - as it IS my choice to have it.

However, if there is something that I'm legitimately entitled to to help cover the additional costs of power and heat, then I will apply for it. They are the only two costs that I was actually enquiring about. Thanks for all your info - much appreciated!

AnxiousMum

Thanks again for all the info- it was a quck phone call to Inland Revenue - and the forms (except for one year which the forms are on 'back order') have been received today to complete. They did verify on the phone though that the above info given by you is correct.
If I purchase things that are work required, but not company paid - ie, things that enable me to do my job better, but are not a requirement by the company to have, that I can also claim these in future years with receipts.
Also - for those with mileage allowance - I get 40p per mile, but if I had a new car, high insurance etc., and did most of my driving for work, it could work out that my car expenses were more than what I was being reimbursed. That's alot of record keeping to do - but could prove beneficial for others.

fengirl_2

'They did verify on the phone though that the above info given by you is correct'

Its good to know that HMRC agrees with the good advice on here - especially as some of us probably wrote the HMRC instruction manuals!

sarflee

I would agree with almost everything you have been advised by HMRC, however don't go spending too much on items that enable you to do your job better. You can only claim for things wholly, exclusively and necessarily needed to carry out your duties and it is often accepted that if your employer will not supply it for you it isn't wholly, necessary.

AnxiousMum

Ahhhh but just because somebody has written a manual, doesn't mean the 'employee' on the other end of the phone is going to actually know what's in it and give correct advice though does it? lol
Sarflee - no intention of going overboard on it - it's there for a reason, and like everything else, not to be abused.

jamesd

AnxiousMum, start reading from EIM32760 - Other expenses: home: working from home and you'll find a range of things that are acceptable for those who have a workplace at home, including travel between the home office and the other office.

A second phone line may be useful to make accounting for calls easier and to avoid getting work calls out of hours on your own normal line.

AnxiousMum

Thanks James - I will have a look at that. In reality my ONLY additional expense is heating and electricity during the day. All other costs are covered by my company as well as mileage etc. But I will certainly have a read