Home Working Allowance for Directors & Employees
Homeworking expenses include supplies used in order to complete your work.
- Computers and other technology
- Internet Access
Homeworking allowance for an employee only applies to expenses that are completely necessary and exclusively in the performance of employee duties.
In other words, you cannot proportion expenses for personal and business use.
Currently, HMRC allows a flat £4 per week fixed expense, which can be reclaimed from the company without the need for any receipts. That’s £208 over a 12 month period.
You cannot claim back any mortgage expenses, despite working from your home, as you would have incurred this expense anyway. Whereas with an itemised phone bill you can pinpoint the business calls.
In addition, if an employee has incurred an extra expense unnecessarily, this cost cannot be claimed back. An example of this would be if your employer provides you with a mobile phone, and you trade this phone for a newer model and incur a further cost.
If you are the owner of your own home, you should not claim over the HMRC recommended amount, as this could make you liable to capital gains tax when selling your property. You may also be subject to business rates.