Self Employed - Home Running Costs

SJ08

Hi,

I currently live at home and use a spare room as my office space, storing inventory/records, meeting clients etc.

I pay house keep each month to contribute to the bills for this.

On my tax return can I claim back the house keep as an expense?

I know you can claim for a proportion of home running costs but as I don't actually pay the bills I'm unsure if I can include it as an expense!

Any advice greatly appreciated.

tyllwyd

I went to a workshop run by the Inland Revenue when I set up as self-employed about ten years ago. I asked the same question - the bills are mainly in my husbands name, so can I include anything for heating etc for my self-employment at home. She said that it was OK as long as there was a paper trail showing that I paid the money to him and he paid the bills.

But make sure the amount you claim is reasonable. You could have a look here
http://www.hmrc.gov.uk/manuals/bimmanual/BIM47820.htm
http://www.hmrc.gov.uk/manuals/bimmanual/BIM47825.htm

SJ08

Thanks for this tyllwyd. I had looked on the HMRC website but couldn't see anything specific to my query - thank you very much for the links.

I can prove the payments as I have it on standing order, but I'll have to have a look at the bills to make sure it's reasonable amount.

The only problem I can see is that I pay fixed amount each month, so as the bills will vary, I may need some working out to do to ensure they are reasonable!

This is my first tax return, so just trying to get everything sorted now!

tyllwyd

Well, someone who knows better than me will probably come along soon, but I wouldn't have thought you need to do anything too complicated - just come up with something on a annual basis and make sure you've paid enough via standing order to cover that. I think that employees are allowed to claim £3 per week for use of a room when they sometimes work at home, so my understanding is that if you allow around £2-£3 per week the taxman won't be worried about it.

(But with a huge disclaimer attached that I am not qualified to give advice!)