UK Landlord Forum / Life

Although I rent a property out in Kent and I rent in London
Can I claim some of my rent as a business expense
Being I use the property to complete my tax return
And use a table and  chair filing cabinet to store all documents and paper work
There must be a % I can claim as a business expense

You can claim £208 without receipts...
http://www.hmrc.gov.uk/manuals/bimmanual/bim47805.htm
...just add the £208 to your ‘Other expenses’ section of the property rental income and expenses pages of a tax return

You can go and try for more but then you get into the time and space calc..
[cost] x [office space/total property space] x [hours worked/total working hours in a 48 week year]

So say a bill costs £1000 and the office is 20% of the property and you do 3 hours a week...
Tax deduction = 1000 x 0.2 x [3 x48]/8064 = £3.57

Money saved = £3.57 x marginal tax rate e.g if you are basic rate payer then you save £0.71

Generally after the "free" £208 pounds the rest is barely worth it.
Note there may be capital gains tax issues if you own your house and later sell it but have claimed a portion as a business expense.
If you designate a room in your home purely as office space, with no personal uses, a portion of your own home could become liable for capital gains tax (CGT) when it is sold. (I understand you are renting but this is for the benefit of others).

This is becuase what you have done overrides the Private Residence Relief, which would otherwise make your main home completely exempt from CGT.

A dual purpose office both for private and business use doesnt fall into this problem for example use it as a family study. - although I cant see Hector the taxman turning up to check this out.

As for your filing cabinet and chair...you can often deduct the cost of purchasing “business assets” from tax entirely using the annual investment allowance but I doubt these two items qualify.  Even if they did they would be a one off deduction apportioned between business and private use.

If that kind of thing is making the difference between a viable rental business or not you have bigger problems I fear.

Best of luck.