How Much Can Limited Company Directors Claim for Working from Home

When working from home you can expect to incur additional expenses, but did you know you’re able to claim tax relief on certain expenses if you’re using part of your home as your office? 

This blog explores what your options are for the 2025/26 tax year, including flat-rate allowances and actual cost calculations to help you understand how much you’re able to claim, and the HMRC approved methods available to you to help reduce your tax bill. 

Flat-Rate Allowance: You can claim £6 per week (£312 per year) without receipts or detailed calculations. 

Actual Cost Method: If you believe that your actual costs are more than the £6 per week flat-rate allowance, you can look to apportion you’re your household expenses based on the size of the space and amount of time used for business purposes. 

Capital Gains Considerations: Be aware that if you are using a significant proportion of your home for business that it may influence your Capital Gains Tax and other reliefs, so ensure you speak to your Client Director for confirmation.  

HMRC provides individuals who work from home with an annual a flat-rate allowance. For the 2024/25 and 2025/26 tax years, the claim is £6 per week / £312 per year without any need for providing receipts to justify the amount. This method allows for a very straightforward way of claiming back expenses when the cost of your home office use is minimal. 

If your home office takes up a substantial amount of space, you can calculate the actual costs. This process involves apportioning your household expenses based on the time and space you spend running your business. For example, if you use one room in your home that has five rooms, solely for the purpose of running your business, you may be able to claim 20% of your household expenses.  

Whilst this can sound appealing, it’s worth knowing that this method requires detailed record keeping and receipts, and that not all household expenses can be included in the calculation. Fixed costs can’t be included as HMRC argue that they would be costs incurred for your primary residence, regardless of whether you worked there or not. Whilst this is the case, variable expenditure such as heating and electricity can be claimed.  

If you are using a significant area of your home to run your business, it can potentially affect your eligibility for Capital Gains Reliefs, such as Private Residence Relief.

It’s important to understand and consider those potential implications before putting in any significant home office claims.  

By claiming home office expenses you’re able to help reduce your overall tax bill, but in order to do it correctly you need to understand the different methods, and which one best suits your situation.   

Make sure you always keep detailed records of usage, and to speak to your Client Director who can offer guidance on claiming home office expenses.