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Where an individual is working from home, they may be able to claim costs on their tax return. There are two ways of calculating the costs and the choice will depend on the number of hours you work from home:  

Use the HMRC simplified flat rate

This method is easy, you apply a fixed rate based on the number of hours you work from home each month. You don’t have to record your personal expenses so the time and effort is minimal. You can only use the simplified method if you work from home at least 25 hours a month.

The rates are:  

25-50 business hours per month  £10 per month 
51-100 business hours per month  £18 per month 
101+ business hours per month  £26 per month 

If you use the telephone or internet for business purposes, you can claim a proportion of these costs on top of the simplified rate. 

Take a portion of your household bills

You can claim a proportion of costs including electricity, heating, council tax, mortgage interest or rent, internet and telephone use. You’ll need to record the costs you have personally incurred and divide these by a reasonable amount.  

You can either take a proportion based on the number of rooms in your home and the number of rooms used for business, or the amount of time you spend working from home. 

For example, say your total costs were £1,200 and you have 6 rooms in your house, and you work from home 1 day every fortnight you could claim £1,200 / 6 rooms = £200 / 14 = £14.29. 

Including your expenses on your self-assessment tax return

It you use an accountant, let them do the calculations for you as part of your self-assessment. At TaxAssist Accountants we’re experienced and helpful and know all about what expenses you can claim for your business. Give TaxAssist Accountants a call today on 0800 0523 555 or use our online contact form

Date published 25 Jan 2023 | Last updated 13 Dec 2023

This article is intended to inform rather than advise and is based on legislation and practice at the time. Taxpayer’s circumstances do vary and if you feel that the information provided is beneficial it is important that you contact us before implementation. If you take, or do not take action as a result of reading this article, before receiving our written endorsement, we will accept no responsibility for any financial loss incurred.

Catherine Heinen, FCCA

Catherine is a Technical Content Writer at TaxAssist Accountants, and a qualified accountant. With experience working at two accountancy practices in the UK top 50 accountancy firms according to Accountancy Age, Catherine has significant experience in accounts, tax returns and advising clients. Catherine ensures businesses, business owners and individuals are kept up to date and informed by providing concise and informative technical material.

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