Business Expenses - Full Annual Rent or Shortfall?

newsaver40

I think i made a mistake on my Tax Asessment Form.

Within allowable Business Expenses (working from Home), i gave my Accountant my Full Annual Rent, but i get Housing Benefit of around 65% of that.

Should i have only given the shortfall amount that i actually pay, which is the remaining 35%?

Notmyrealname

Oh dear.

You are only allowed to claim a portion of the rent that a room used SOLELY for business purposes forms of a house. So if you use one room in a 4 room house you can only claim 25% of the rent. If the rent is £100 a week you could only claim £25 as a business expense.

And that is only if the rooms SOLE use is for business. If you use the room for personal use as well as business, i.e running it from your living room that you watch TV in on a night, you can only claim a flat rate which OTTOMH is £150 a year.

Unless you use 35% of your house solely for your business you cannot claim 35% of the rent. As you live in your house you cannot claim 100% of the rent.

newsaver40

Oops!
I use my spare Bedroom most of the day as an office. (It's not really used at all for anything else other than keeping my clothes & shoes in and storing Stock and packaging materials).

I can be in there working on my PC and doing other bits & pieces for anything from 8.30am until 10pm at night (on and off).
I'd say 7-8 hours a day at the very least!

Not sure what percentage i can claim for that (?).

Notmyrealname

If you store your clothes and shoes in it, it isn't solely for business purposes.

You can only claim the flat annual rate of £150.

If you remove your clothes and shoes, it is then solely for business purposes. You can then claim only the percentage of the house that the room forms, i.e if it is a 5 room house you can only claim 20% of the rent. What you get in HB doesn't come into it.

newsaver40

Ah, i see.......got you.
Thanks for the info!