Working from home - claiming mortgage interest as ltd co

MrCarrot

I have a limited company, and an office around 5 miles away from my home. I use the office for meetings only, and while it's not beyond the realms of impossibility that I could work there I choose to work at home.

I currently pay myself an allowance of £3 a week for working at home. I realise there has been a big thing recently about self-employed people being able to claim a percentage of mortgage interest and council tax if they work at home. However, I am not sure this applies to directors who work for their own limited company?

Could someone clarify if this does only apply to sole traders as opposed to ltd co directors? If it applies to both, I am also wondering what the tax man would make of me working from home when I have an office? From my point of view, I don't employ anyone on the permises and have no reason to go there everyday when I can do my job at home.

dmg24

Is the house in your name or that of the company?

BargainGalore

If its your own home I think you have to make sure your mortgage company knows along with your insurance company

MrCarrot

Thanks for the reply. The office is rented by my company. My home and mortgage is owned by me personally.

As for claiming £3 per week, I have done this based on the following guidance:

"Tax allowances and reliefs - employees or directors > Tax relief for household expenses when working at home

A flat rate deduction of £3.00 per week (from 2008-09) for each week that you've got to work at home. This doesn't include the cost of business telephone calls."

However I have just noticed it also says:

"You won't be able to get relief on domestic expenses that you're paying anyway - like your mortgage or council tax. You also won't be able to get relief for expenses that relate to both business and private use - such as your telephone line rental, or Internet access."

Therefore I think I'v answered my own question. But it seems as though I am well within my rights to claim £3 a week from my ltd co and that the company won't pay tax on that. Further down in the guidance it also talks about "volunteering" to work at home rather than "having to" and says you can still claim the £3 a week.

I hope I am not wrong on this one!

http://www.hmrc.gov.uk/incometax/relief-household.htm