Work From Home Expenses for the Self-Employed
If you’re self-employed and run your business from home, the rules around claiming expenses are more flexible, but it’s essential to be both accurate and reasonable in what you claim. HMRC allows you to deduct a proportion of your household costs, but only those that are wholly and exclusively for the purpose of your business.
Key Work From Home Expenses You Can Claim
A Proportion of Your Home Costs
You can claim part of the cost of running your home, including:
- Rent or mortgage interest (not the full mortgage)
- Council tax
- Water rates
- Gas and electricity bills
- Home insurance (if partly covering business use)
There are two methods to work out what you can claim:
Method 1: Proportional Method
Calculate what percentage of your home is used for business, often based on the number of rooms and hours of business use.
Example: If you use 1 room out of 5, and only during working hours, you could claim 1/5 of 1/3 of your total household bills.
Method 2: Simplified Expenses (Flat Rate)
HMRC also offers a flat-rate method based on how many hours a month you work from home:
- 25–50 hours/month: £10/month
- 51–100 hours/month: £18/month
- 101+ hours/month: £26/month
This method does not cover telephone or internet usage, those must be calculated separately.
Office Equipment and Supplies
You can claim for essential tools and supplies such as:
- Laptops and desktop computers
- Printers, paper, and ink
- Desks, chairs, filing cabinets
- Software subscriptions and licences
If the item is a capital asset (e.g. a high-value laptop), it may need to be claimed via capital allowances.
Business Insurance
If you pay for public liability, professional indemnity, or business contents insurance, you can deduct the full cost as a business expense.
Internet and Telephone Usage
You can claim:
- The full cost if the line or contract is exclusively for business
A reasonable proportion if it’s a shared connection or phone – based on usage logs or itemised bills
Tip: It’s useful to keep a breakdown or diary of your work-related calls and usage to support your claim.
How to Claim Work From Home Expenses as a Self-Employed Individual
Work from home expenses are claimed via your Self-Assessment tax return, specifically, in the expenses section of your SA103 form (either short or full version depending on your situation).
To ensure accuracy:
- Keep detailed records and receipts
- Be prepared to justify how you’ve calculated proportions
- Only claim expenses that are wholly and exclusively for your business
If you’re using part of your home exclusively for business, there may be Capital Gains Tax implications when selling your home, so it’s often better to maintain dual-use rooms where possible.
Further Reading from HMRC:
- Expenses if you’re self-employed
- Simplified expenses for working from home
What’s Not Included in Work From Home Expenses?
While HMRC allows a broad range of work-related costs to be claimed when working from home, it’s just as important to understand what you cannot claim. Overstating or incorrectly claiming expenses can lead to penalties, so clarity is key.
Common Expenses You Cannot Claim
General Household Expenses
You can’t claim everyday living costs that aren’t directly related to your work, such as:
- Food and groceries
- Mortgage capital repayments (only interest is partially allowable in specific cases)
- Personal clothing (unless it’s protective gear required for your trade)
- General repairs and maintenance to your home that aren’t related to your business workspace
Example: Fixing a boiler benefits the whole house and is not considered a business expense, even if you work from home.
Costs for Non-Business Use
You can only claim the business-use proportion of any shared costs or assets:
- If you use your phone line for both work and personal calls, you must calculate a reasonable percentage based on business usage
- A spare bedroom that doubles as a guest room cannot be claimed in full as an office
- Shared broadband services must be proportioned accurately
HMRC stresses the importance of claiming only expenses that are “wholly and exclusively” for business use. If you can’t clearly separate personal and business use, you may not be able to claim the expense at all.
Tip: Be Reasonable and Keep Records
When in doubt, it’s best to:
- Use itemised bills or time logs to justify proportions
- Avoid claiming items that serve a dual purpose unless clearly measurable
- Keep receipts and notes in case HMRC requests evidence during a review
By sticking to these rules, you’ll avoid compliance issues while still claiming what you’re entitled to.
Top Tips for Maximising Your Work From Home Expense Claims
Whether you’re an employee or self-employed, being proactive and organised can help you get the full tax relief you’re entitled to, without falling foul of HMRC rules.
Here are our top tips to help you maximise your claims:
- Maintain receipts and invoices for every expense you plan to claim
- Log your working hours, the room(s) used, and how frequently they’re used for business
- For shared costs, consider keeping a usage diary or using itemised bills to help justify the business-use percentage
Be Accurate in Your Calculations
- When splitting expenses between business and personal use (e.g. electricity, broadband, or phone), make sure your calculations are realistic and evidence-based
- Avoid guessing – HMRC may ask for justification if your numbers seem too high
Example: If your energy bill is £120/month and you work from one room out of four for 40 hours a week, you might only be able to claim £30/month.
Claim What You’re Entitled To
- If you’re an employee required to work from home, the flat rate of £6/week (£26/month) is an easy way to claim without paperwork
- If your actual costs exceed this, you may still be able to claim more, just make sure you can back it up with evidence
- Self-employed? Use HMRC’s simplified expense rates or detailed cost method depending on what benefits you most
Further Resources and Help
For more guidance on claiming work from home expenses, visit:
Conclusion: How Accounting Wise Can Help with Work From Home Expenses
Navigating work from home expenses can be confusing especially when it comes to knowing what you can claim, how much you’re entitled to, and how to keep compliant with HMRC rules. Whether you’re an employee looking for simple tax relief or a self-employed professional calculating your exact home office costs, accuracy is essential.
At Accounting Wise, we make it easy. Our expert team supports UK individuals and businesses with:
- Personalised tax advice
- Self Assessment and expense claims
- Bookkeeping and cloud accounting
- Full compliance with HMRC regulations
If you’re unsure about what qualifies as a work from home expense, or simply want peace of mind that you’re not leaving money on the table, we’re here to help.
Get in touch with us today to ensure your work from home claims are handled correctly and your finances stay in great shape.
