Working From Home - Home Office Household Bills Helps Please!

kemo_2002

Can anybody help me with these figures, i work from home, i have a room i dedicate to this, although it isnt used 'soley' for my business.

I have 6 rooms in house including bathroom and kitchen, i spend aprox 7 hours per day working in my 'office' I hav been reading up on what i can and cannt claim as reguards to household bills and im really struggling with the figures so i was hoping somebody could help me.

Electric bill - £12.92 per week
Gas Bill - £9.92 per week
Broadband - £2.33 per week
Council tax - £20.76 per week
Mortgage Interest - How do i work this out???

I hope somebody can help! totally comfused!

Regshoe

Take a look at the HMRC examples:

http://www.hmrc.gov.uk/manuals/bimmanual/BIM47825.htm

Example 4 is probably closest to your situation.

Your mortgage provider should be able to provide you with the split between interest and capital.

Assuming the interest comes to £50 a week for example your calculation might look as follows (though the general rule is it has to be a 'reasonable' apportionment). Lets also assume you use this room for 3 hours a day for other non-business purposes.

Fixed Costs:

Mtg Interest £50
Ctax £20.76
Bband £2.33

Total Fixed Costs £73.09 pw

Variable Costs

Gas £ 9.92
Elec £ 12.92

Total Variable Costs £22.84

Now i think HMRC would prefer a split by floorspace rather than by number of rooms, but if you assume all rooms are of equal size then:

Fixed costs = 73.09 x 1/6 (number of rooms) x 7/24 (proportion of day in business use) = £3.55 pw

Variable Costs = £22.84 x 1/6 (number of rooms) x 7/10 (proportion of total time the room is used that is business use) = £2.66

So total cost PW = £3.55+2.66 = £6.21

I wouldn't normally work in £ per week - but as you'd given figures in that format I stuck with it. Normally I would just add up all of the costs for the period in question and apportion these - no real need to calculate a weekly rate, expect to compare to the 'no questions asked' rate. Obviously the mortgage interest size will have a big impact on the number and so will the comparative size of the room if you use a floorspace calculation.

You can claim £4 a week for 2012/13 (£3 a week for 2011/12 and a few years before that) without needing all of the above justification - but as this example calculation shows it may be worth doing it.

kemo_2002

Thankyou, the room i use is a spare bedroom, it is slightly smaller than the other rooms in hte house, using it 7 hours a day..probably 30min - 1 hours for other use - dressing (its where are clothes are as well)

maybe it would be esier to give month figures...

Electric - 52
Gas - 46
Broadband - 10
Council Tax - 90
morgage interest - i pay approx £340 in INTEREST per month on my mortgage (found my statement)

LazyLizzie

Regshoe wrote: »

You can claim £4 a week for 2012/13 (£3 a week for 2011/12 and a few years before that) without needing all of the above justification - but as this example calculation shows it may be worth doing it.

Where can I find more info about that?

HappyMJ

I didn't think the bathroom and kitchen count as rooms. Only living and bed rooms count.

Regshoe

HappyMJ wrote: »

I didn't think the bathroom and kitchen count as rooms. Only living and bed rooms count.

Having had a quick search the general consensus does seem to be to exclude kitchen's and bathrooms, there are some references to 'habitable' rooms and whether or not you make 'business' use of the bathroom and kitchen (arguable if you have employees using a home office, but potentially dubious otherwise).

There don't seem to be any hard and fast rules, so it comes down to the apportionment being justifiable and reasonable, so yes you could potentially exclude the bathroom and kitchen. But then what if you have a kitchen-diner..... It can all get rather murky, a grey area. Essentially if you try to claim a very large proportion then expect to have it questioned/rejected by HMRC. That doesn't mean they are right of course, they do lose these arguments at tribunal, though you have to ask yourself if it is worht the time/effort.

LazyLizzie - the following link is actually about payments to employees rather than expenses for the self-employed, though the general consensus is that if tha't the no questions asked rate for the employed then it should be ok for the self-employed. The link I posted earlier showed that HMRC was accepting obvious £2 a week claims, but that was at the time when the limit was £2 for the employed as well.

http://www.hmrc.gov.uk/paye/exb/a-z/h/homeworking.htm#3