Sole Trader: Sole traders can claim ‘use of home as office’ under HMRC’s simplified expenses system. This equates to £10 per month for 25-50 hours worked at home per month, £18 for 51-100 hours, and £26 for 101 hours or more. This is usually best for anyone who owns their house with a repayment mortgage. For those with an interest-only mortgage, or who rent, using the calculation method is usually more effective. This would involve collating all your household utilities for the year (gas and electric, water, council tax, rent/mortgage interest) and working out a proportion of your costs depending on the floorspace utilised whilst working from home, and the percentage of time used.
Our clients will be provided with a detailed spreadsheet so that the calculations can be done quickly. Once you have chosen the method of calculation, you are unable to change over.