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home office tax deduction

Home Office Tax Deduction

How to Claim a Home Office Tax Deduction

This article was published a while ago.
The latest information can be found in our guide:
Small Business Tax Saving Tactics

Many businesses start in a spare bedroom or on the dining room table. Even when they’re well established, most business owners work from home at least part of the time, for example during the evening or on weekends.

Working from home means you can claim part of your household costs for tax purposes as a home office tax deduction.

But who can claim, how much and which costs?

Almost everyone in business can make some claim for ‘use of home’. We don’t know any business owner who doesn’t at least take some paperwork home or make business calls from home.

Home Office Tax Deduction - Example

Imagine you’re a sole trader running a small garage. You need to renew your business premises insurance. You take the proposal form home to complete after work. You’ve just used your home for business and you are entitled to make a claim.

It constantly amazes us how many people think they’re not entitled to a home office tax deduction: there are so many popular misconceptions about it. Many people think they can’t claim because they’re already claiming for an office, a shop, or other business premises. Not true!

Although the amount of the claim is likely to be less, a ‘use of home’ claim is still possible as long as some work is carried out at home. (It’s also worth noting that, if you have two or more homes, you can make claims in respect of any business use of any of them.)