Eligible cleaning costs?

I work from home in a Ltd company. I am a director in this start-up company. I occasionally have customers and suppliers in my house for meetings etc.
If the company employs a cleaner who cleans the house, less bedrooms, will this be seen as a taxable perk? The area covered would be the through lounge and dining room (where I work), kitchen, hall, landing and bathroom. I feel these areas are the ones used through the day in the course of work. My income is fairly low at the moment and so any taxable perk would have an impact on my WTC etc, to the point a cleaner becomes quite expensive to me personally.
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bathroom.

work.

an

I would get the cleaner to invoice you separately for the clearly non work portion so that there is less likely to be a benefit in kind challenge. How much are we talking about here?
--
Doug Ramage



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will

me

How

Probably a few hours a week, for 6-7 per hour. I would say 20-30. My question was really based on how far a "work portion" could go. In essence could it include the area seen by customers and used by myself during the working day?
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work

essence

On another point, do make sure you have proper insurance in place for employees _and_ clients being on the (home) premises.
--
Martin

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challenge.

the

Likewise for any items which have some business use - computers, cars etc.
--
Doug Ramage



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have

to

work

essence

Personally I feel that you need to pro rata it based a lot more upon the time of business use. If you claim for 3 hours cleaning a week for a room used for meetings for 3 hours a week and personal use for 165, the revenue will see it for what it is: TTP.
tim
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for

bedrooms,

through

of

challenge.

the

Also as a director you have to convince IR that working from home is 'necessary' for the performance of your duties. Otherwise, every director, office holder or employee will be bringing clients home and claiming a proportion of cost of heating, lighting, cleaning, insurance, Council Tax etc as working expense.
Alec
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Alec wrote:

Working from home is obviously "necessary" in the sense that it is cheaper to "rent" office space from yourself than to rent separate business premises.
Were the chap not working from home, he'd necessarily be claiming rather higher expenses, which would only increase the frown on the tax man's face.
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My

There are no other company premises. Any work is either carried out at home or contracted out. The house is rented so can claim an allowance fom the company of 25% of the rent. No single room is used mainly for work therefore my working at home should not attract business rates.
I doubt I can receive an allowance towards council tax?
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during

director,

Tax

home

Council tax can be an allowable deduction.
The IR are unlikely query relatively small amounts - say, up to 5 to 6 per week.
--
Doug Ramage



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20-30.

In

the

I'm genuinely surprised at that. Council tax is a tax I associate with residential dwellings and business rates with company premises. Therefore I thought you either pay council tax for the part not used for business use and business rates on the part used for business. Typically though with the banding structure, council tax doesn't reduce down a band if just a room is taken out of the equation.
I live and learn!

per

I was thinking along the lines as long as the purely residential parts of the house are not cleaned or billed separately it'll be OK.
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I'm also of the opinion that the IR won't query small amounts, especially if they are small in proportion to the total turnover. I'm pretty sure the IR (and C&E, etc.) have a set of 'norms' that they check your returns against. If your claims are within the normal range for the type of business thay are unlikely to ask questions about specific items.
--
Chris Green

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£6

of

Agreed, I've seen a believable view that the 'working from home' figure is 10 quid per week in total, not plus cleaning, council tax electric etc...
tim

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wrote:

to

I'm sorry but don't understand what this figure of 10 is? Am I right in understanding that it the figure of benefit in kind to the employee, ie where the company pays the cleaning, part council tax, part rent etc?
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It's the figure that you can claim against tax for 'use of home as office' without the revenue putting you in the 'audit' pile.
You may be able to justify more, you might find that the cost of doing so (in yours and your accountant's time) is not worth the effort. Unless the revenue are unreasonable in their demands (for paperwork etc) you won't get these costs back.

This will be 'amount actually paid' minus the 'amount allowed' (i.e the above 10 pounds)
hth
tim

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parts

Its an amount that people have put on their returns and because it is low and the IR does not have enough resources to challenge every claim, they concentrate there limited resources on those that put more exhorbitant claims on their returns.
We are talking about a director making a claim under S198 ICTA 1988 or S336 ITEPA 2003.
In Hillyer v Leeke, Goulding J said that the terms of S198(1) were exacting and almost impossible to satisfy and Ihave to agree.
There are thousands of people who work from home and there are others that have a work place at home. The difference might be subtle but it is there.
The office worker with the need for quite who goes home to work in the comparative quite is not incuring costs that satisfy S198(1) as they are not necessarily incured nor in the course of his duties.
The person who sets up office facilities and operates his own business from his home is incurring expenses but these do have to be attributable to the business activity. Domestic Rates or council tax do not fit that bill. They would not vary whether the business was run from the home or not so would not be allowable.
Where you do not have a room that is set aside for exclusive business use, you are looking at a proportion of the room or rooms that are used for business purposes and any bill that is greater because of the business activity could certainly be demonstrated to have a business element.
This can happen for gas and electricity bills, itemised telephone calls but others will not, such as rent, TV licence, council tax and anything else that has a fixed charge and is not exclusively for the business use.
Although the bottom line here is even if it is not strictly correct, if you are not greedy, you will probably not be asked to explain yourself.
Simon
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I was a computer contractor for many years and worked (as is normal) through a Ltd. company. My wife also does freelance work and uses the company too.
In this situation it's quite easy to charge things as expenses to the company, it doesn't appear on our personal tax returns as a claim for use of the house as a business expense.
However we don't charge any cleaning or anything like that to the company, on the other hand we're not too strict about making sure that company sellotape is only used for company use. We do split phone usage by having a separate line for the company.
I think the IR (as I said) have a set of norms for a small business and as long as you are close to these norms they leave you alone. We lose a bit by not charging cleaning expenses etc. to the company but we gain a bit by using their sellotape (etc.).
--
Chris Green

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When working from home I had telephone voice line rental disallowed as there was only one voice line, even though the business could not have functioned without a phone. £250 heat and light allowance was never queried though, but if it had I could have shown from the billing history that this was a fair assessment of the extra costs caused by running my home office.
--
Tony Bryer SDA UK 'Software to build on' http://www.sda.co.uk



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Simon wrote:

I have heard this about telephone line rental since it is a facility you make use of privately. However the cost of calls and services primarily used for business purposes I thought were allowable. In my case redirection services and associated call charges.
I also have a second line which I use for making business calls and I believe (hope) this is treated differently and fully allowable.
Many people use their home as a second office. My home is my place of work and even my garage is used as a store and workshop.
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I was referring to line rental as opposed to call charges
--
Tony Bryer SDA UK 'Software to build on' http://www.sda.co.uk



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