Working from home allowance

[UKSBD]

I see the working from home allowance is going up to £6 a week from April

Can you pay all employees this, irrespective of how many hours they work and without them having to justify any household costs?

For example, myself, my wife and my daughter all work from home for the company (wife and daughter only work part time).

Can the company pay all three of us an extra £6.00 a week?

 

[MARA&TS]

You can pay all employees the weekly home allowance rate as long as they have to work from home, if its the employee's choice to work from home then I believe that this would not be allowable unless is it processed through PAYE or is processed as a benefit in kind.

With regards to it being yourself, your wife and your daughter this adds more complexity to the situation and I believe HMRC would probably want to know more information about this arrangement before they would be satisfied with allowing round some payments to be paid/claimed.

 

[Newchodge]

You can pay all employees the weekly home allowance rate as long as they have to work from home, if its the employee's choice to work from home then I believe that this would not be allowable unless is it processed through PAYE or is processed as a benefit in kind.

With regards to it being yourself, your wife and your daughter this adds more complexity to the situation and I believe HMRC would probably want to know more information about this arrangement before they would be satisfied with allowing round some payments to be paid/claimed.

Well, that's helpful

 

[UK Contractor Accountant]

Strikes me you are doing it the wrong way round.

You would get a better tax deduction if you + wife rented the office space to your company via a formal rent or licence agreement.

 

[UKSBD]

Thanks, but didn't really want all the potential capital gains hassle for the sakes of a few £ of tax relief.

At the moment my accountant just puts the £208 a year through (about £40 benefit?)

I'd rather just do it that way than have one room designated for the business

If we were talking of £100's of pounds benefit I might consider it, if less than couple of hundred, it's not worth the hassle.

 

[UK Contractor Accountant]

Thanks, but didn't really want all the potential capital gains hassle for the sakes of a few £ of tax relief.

there isn't any CGT issues if you do it correctly!

 

[Alison Moore]

If you formally rented the space to your business then I would have thought it would be classed as a business premises and subject to commercial rates. Ok, rates are free for a year, but they won't always be, plus it can add complexity if you try to sell if part of the building is classed as a business. I personally wouldn't go down that line and just treat it, like you are doing, as a home office.

 

[Newchodge]

If you formally rented the space to your business then I would have thought it would be classed as a business premises and subject to commercial rates. Ok, rates are free for a year, but they won't always be, plus it can add complexity if you try to sell if part of the building is classed as a business. I personally wouldn't go down that line and just treat it, like you are doing, as a home office.

So the answer to the original question? If more than one person is employed by the same limited company, and each of them works from the same home, can each of them claim working from home expenses?

 

[SteveHa]

If you formally rented the space to your business then I would have thought it would be classed as a business premises and subject to commercial rates.

Not for shared spaces. Same applies for CGT.