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ExpensesUpdated 2026-02-12

Can I claim working from home expenses?

Quick Answer

Yes. Your company can pay you £6/week (£312/year) tax-free for working from home. Alternatively, you can claim a proportion of actual home costs based on business use.

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Detailed Explanation

There are two methods for claiming home working expenses through your limited company:

Option 1: Flat rate (£6/week) - Company pays you £6 per week (£312 per year) tax-free - No receipts or records required - Must work from home regularly (not occasional) - Cannot claim if you have a separate home office building

Option 2: Actual costs apportionment - Calculate proportion of home used for business - Claim that proportion of: rent/mortgage interest, utilities, council tax, broadband, insurance - Requires careful record-keeping - Two methods: by room or by time

Example (by room)

- 5-room house, 1 room as office = 20% - Annual costs: £12,000 (rent, utilities, council tax, broadband) - Claimable: £12,000 x 20% = £2,400

Important notes

- Mortgage capital repayments are never deductible - Only mortgage interest qualifies - If you own your home and claim, consider CGT implications on sale - For employed directors, use flat rate to avoid P11D complications

What you can also claim separately

- Dedicated business equipment (desk, chair, monitor) - Business phone line - Office supplies

Source: HMRC Working From Home Allowance

Real-World Examples

Limited Company Director running a consultancy

Sarah runs a consulting business from her spare bedroom. She regularly works from home 5 days a week. Her company can pay her a tax-free allowance of £312 per year without needing to track her actual expenses.

Software Developer with High Utility Bills

Mark is a software developer who works from home, using power-hungry computers. He decides to calculate the actual costs. He uses 20% of his home for work, resulting in a larger claim than the flat rate allowance, and keeps detailed records to support this claim.

Director renting their home

Jane rents her flat and dedicates a room solely for business use. She can claim a portion of the rent, plus business related expenses, based on the percentage of her home used for work. Jane must keep all receipts and be able to justify the business proportion used.

Common Mistakes to Avoid

  • Claiming the flat rate allowance when you have a separate building designated solely as a home office.
  • Failing to keep detailed records and receipts when claiming a proportion of actual home costs, leading to potential HMRC challenges.
  • Claiming for expenses that are already provided by your employer or another company, resulting in double-dipping.
  • Forgetting to adjust your claim if your work pattern changes significantly during the year (e.g. you move office).

If I only work from home part of the week, can I still claim the flat rate?

Yes, the flat rate of £6 per week can be claimed as long as you regularly work from home. It does not have to be every day of the week.

How do I calculate the business proportion of my home if I use a room for both personal and business purposes?

Determine the floor area of the room used for both personal and business use. Then, estimate the amount of time the room is used for business activities. The business proportion is then based on the floor area multiplied by the business usage time.

Can I claim for office equipment bought for my home office, such as a desk or chair?

Yes, but these are treated as capital allowances. Your company buys the asset and claims the appropriate capital allowance against profits. Note that the Annual Investment Allowance (AIA) may be applicable.

Are there any expenses I *cannot* claim when working from home?

You cannot claim expenses that have a 'duality of purpose,' meaning they are for both personal and business use, without a reasonable method of apportionment (aside from the allowable percentage). For example, you can't claim the full cost of groceries just because you ate lunch at home while working.

Practical Tips

  • Start tracking your work-from-home days and expenses immediately to ensure accurate record-keeping for your claims.
  • If claiming actual costs, take photos of your home office and document the measurements of the areas used for business to justify your calculations to HMRC.
  • Review your chosen method (flat rate vs. actual costs) annually to determine which approach is most beneficial for your specific circumstances.
  • Use accounting software like AccountsOS to efficiently track and categorize your work-from-home expenses, making tax filing simpler.

Related Questions

What expenses can I claim through my company?

You can claim expenses that are 'wholly and exclusively' for business purposes. This includes travel, equipment, professional subscriptions, training, marketing, and business insurance.

Can I claim my phone bill as a business expense?

Yes, but only the business portion. If you use a personal phone for work, you can claim the percentage used for business. A phone contract in the company's name is simpler and fully deductible.

What is the mileage allowance?

The Approved Mileage Allowance Payment (AMAP) is 45p per mile for the first 10,000 business miles and 25p per mile thereafter. This covers fuel and running costs.

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