Working from home expenses

System

This discussion was created from comments split from: How to treat gift purchased by business and process relating payment.

nohatohamy

hi,
i hope if i can get assistance on this case,
my Clint a hair dresser works from home using one room for her business from four bedroom house.
My question is to claim expenses for light, heat, water and rent.
shall i calculate the cost by dividing the total expenses cost by four, as she is only using one bedroom.

Many thanks,

MarieNoelle

Hi @nohatohamy
I have created a new thread as your question doesn't relate to the original OP and you may solicit more answers if you ask your own question.
Is your client a sole trader? Is the room used exclusively for business or does it have some private use?

nohatohamy

Hi,
Apologise for confusion, its my first time to enter the disscution.
My Clint self employed and the room is used exclusively for business.

Thanks

MarieNoelle

Hi
In short yes you can apportion the living costs to either the number of rooms or floor space as use of home.

This extract from an article on Taxationweb explains the consequences of claiming exclusive business use though.

When there is exclusive business use of a specific part of the home, the taxpayer will need to consider the implications carefully before proceeding to claim a deduction. When the house is sold the normal capital gains tax exemption on the disposal of a 'principle private residence' will be subject to a potential restriction in respect of any part of the gain that relates to exclusive business use. In addition, business rates might become payable in respect of the non-domestic use of an area of the house.

nohatohamy

Thank you and really appreciate your help.