An easy way to calculate Electric costs?

Another of these very basic things - but is there an EASY formula for calculating how much of your home electric you can say is for business purposes, to put in the expenses box on forms?

Example is 20% of electric cost a reasonable percentage of electric use to put on expenses for a home based business that uses a personal account to surf the web /combine social media chats/auctions etc. ? or would it be better at 10% ?

Comments

  • Savvy_Sue
    Savvy_Sue Posts: 45,892
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    I think generally you work out the ratio between no. of rooms used for business and the total no. of rooms (excluding bathrooms and kitchens), and then consider no. of hours used for business.

    So you use one bedroom in a two up / two down house, so 1/4 of your house is used for business. But you don't work 24/7, maybe 1/3 of each day.

    No-one expects you to do it precisely. But what's reasonable?
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  • HappyMJ
    HappyMJ Posts: 21,115
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    Another of these very basic things - but is there an EASY formula for calculating how much of your home electric you can say is for business purposes, to put in the expenses box on forms?

    Example is 20% of electric cost a reasonable percentage of electric use to put on expenses for a home based business that uses a personal account to surf the web /combine social media chats/auctions etc. ? or would it be better at 10% ?
    I'd just go with the simplified expenses amount.

    https://www.gov.uk/simpler-income-tax-simplified-expenses/working-from-home

    Hours of business use per month Flat rate per month
    25 to 50 £10
    51 to 100 £18
    101 and more £26
    :footie:
    :p Regular savers earn 6% interest (HSBC, First Direct, M&S) :p Loans cost 2.9% per year (Nationwide) = FREE money. :p
  • Aquamania
    Aquamania Posts: 2,112 Forumite
    HappyMJ wrote: »
    I'd just go with the simplified expenses amount.

    https://www.gov.uk/simpler-income-tax-simplified-expenses/working-from-home

    Hours of business use per month Flat rate per month
    25 to 50 £10
    51 to 100 £18
    101 and more £26

    Thank you HappyMJ.

    I wasn't aware of that flat rate allowance, but as someone that often works from home that will be very useful :)

    However, may I just add by way of clarification, that those flat rates cover ALL expenses for using your home (except telephone & internet charges), and not just electricity.

    But definitely a simpler way for most to handle their tax return.
  • Wow I never realised there was a flat rate.

    This doesn't include phone/internet. So remember to add that on.
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