Household expenses

Yorky

Does anyone know what household expenses can be offset against tax?

In the UK the Revenue has clarified use of home, so you can also claim house insurance, water charges (if any) and mortgage interest.

One should work out the proportion carefully, ideally by floor space and the amount of time that it is used.

The UK Revenue provides examples at the following address:

http://www.hmrc.gov.uk/manuals/bimmanual/BIM47825.htm

The following also provides one or two clarifications:

http://www.bytestart.co.uk/content/t...se-claim.shtml

Doea anyone know if it is permitted in the Republic of Ireland to claim the above-mentioned?

I've never claimed household expenses due to the CGT liability in the event of selling the house but considering the reduction in house prices this liability would not arise for the forseeable future.

MBateson

Only bin charges AFAIK and I think that's going to be phased out.

kennyb3

MBateson is correct, only bin charges are allowed unless you are using a portion of your house for buisness.

barneystinson

kennyb3 wrote: »

MBateson is correct, only bin charges are allowed unless you are using a portion of your house for buisness.

(... which the OP clearly is, if you look at the examples he/she has linked to and the references to affecting PPR entitlement...)

OP, The Acts don't give a list of what is allowed to be deducted, but Section 81 of TCA 1997 outlines what is not allowed to be deducted, so if you're not going to seek professional advice (which by the way you probably should before making a decision), then you should have a look there. http://www.irishstatutebook.ie/1997/en/act/pub/0039/sec0081.html#sec81

Personally I think you're kind of snookered if one takes the most literal application of the Section - the general rule is that any expense you claim has been wholly and exclusively laid out for the purposes of the trade.

I would say that only incrememental expenses, on top of those which you incur anyway, would be allowable. For example, if your house insurance increases as a consequence of you using part of the house for conducting a trade, then certainly that additional cost is a deductible expense. But if your premium is unchanged from what it was when the house was only in use as a residence, then I don't reallly see how you could argue a case for allowing a proportion of it... ditto any other household expenses that are not affected by the presence or absence of the trade. (Maybe someone else will wade in and prove me wrong here, there's surely precedents or case law in this area).

Anything that is a variable expense, and can be argued to have increased through the partial business use of the house, should be deductible, so a portion of ESB, Heating, Phone etc...

As regards mortgage interest, if you are receiving mortgage interest relief then you are potentially poking a hornets nest; you would have to determine how to apportion it between domestic/business etc... this would then give rise to questions as to whether you should have been getting full TRS in prior years if you had been using the house for your trade all along... messy messy messy, so I'm going to stop thinking about it now!

Ultimately though, I would say if you are using your house for business, depending on the Inspector and as long as you haven't taken the p1ss in terms of the amounts you've claimed, they won't split hairs with you over claiming a few quid here and there out of the costs of running things...