What you need to know about Home Office Allowances?

The Home Office Allowances is a fixed amount. Which any self-employed and anyone operating from their home can claim. This is possible via a method called as simplified costs, and the amount of Home Office Allowance you may claim is determined by the number of hours you work from home each month. Moreover, in comparison to manually calculating all of your company charges, this approach is a simpler means of claiming home expenses.

As a self-employed, you can claim your house as a cost in two ways:

Calculate your rent, mortgage, and expenses before determining how much of your house is used for business.

Also, use a set rate, referred to as the home office allowances.

What is the rate of Home Office Allowances?

The amount of Home Office Allowances you may claim is entirely determined by how frequently you work from home. Obviously, the good news is that you don’t have to calculate how much of your house is dedicated to work. You can claim the business expenses incurred with various costs. However, when you list your house as an expense, things get much more tricky.

Monthly use for BusinessFlat rate 
25 – 50 hours£10 per month
51 – 100 hours£18 per month
More than 101 hours£26 per month

The fixed fee does not include phone or internet costs. Although by calculating the real expenses, you can claim the business percentage of these expenditures. Also, HMRC offers a simplified expenses checker you may use to compare what you can claim using simplified expenses to what you can claim by calculating the real costs.

What is considered as working from Home?

Working from home examples include the following:

  • Anything you perform for a customer or a contractor
  • preparing and submitting your taxes
  • Organizing your receipts and invoices
  • And, in general, anything else work-related!

What HMRC is concerned about is that your ‘business usage’ at home is fair. However, in most circumstances, this implies it should be comparable to your income from self-employment. Got more questions regarding home office allowances? Book a free consultation to get your query resolved.

Share This :

Leave a Comment

Your email address will not be published. Required fields are marked *

Recent Post

Dont Hesitate To Contact Us

We would love to hear from you.