If you’re a limited company director who works from home, your company may be able to claim some of the costs involved.
The £6 per week homeworking allowance
For most owner-managed limited companies, the simplest option is to use HMRC’s flat-rate homeworking allowance.
If you regularly work from home, your company can normally pay you £6 per week (£26 per month) towards your additional household costs. There’s no need to keep receipts or work out exactly how much extra you’ve spent.
The payment is usually deductible for Corporation Tax purposes and, provided the qualifying conditions are met, is not taxable on the director.
For many small companies, it’s an easy way to cover homeworking costs without having to calculate and justify a claim for actual household expenses.
Can your company reimburse more than £6 per week?
Yes, provided the figures can be justified.
If working from home genuinely costs you more than the flat-rate allowance, your company can reimburse the additional costs instead.
These might include claiming a reasonable proportion of:
- Heating and electricity
- Metered water costs, where applicable
- Business telephone calls
- Additional broadband costs relating to business use
- Other household costs directly attributable to working from home
The key point is that you’re claiming the additional cost of working from home, not simply a share of your household bills.
In practice, many directors calculate a reasonable business proportion based on factors such as the number of rooms in the property and how often the workspace is used for work. The calculation should be fair and capable of being explained if HMRC ever asks how it was arrived at.
It’s also worth remembering that costs such as Council Tax, mortgage capital repayments and normal household living costs cannot simply be apportioned because you work from home. The claim should reflect the additional expense incurred by the business.
If you make a claim for more than the £6/week flat allowance, you should keep copies of all of your household bills together with details of how you calculated the business element.
Office equipment claims are different
The £6 weekly allowance only covers the additional costs of working from home. It doesn’t include office equipment.
If your company buys equipment for business use, it can normally claim tax relief on items such as:
- Laptops and desktop computers
- Computer monitors
- Office desks
- Ergonomic chairs
- Printers and other office equipment
These are separate from homeworking expenses and are normally treated as business purchases.
For more information on other costs your company may be able to claim, and how to make sure you don’t claim for any personal costs, see our complete guide to limited company expenses.
Should you charge rent to your company?
Some directors consider charging their company rent for using a room as an office.
This normally involves putting a formal licence or rental agreement in place between you and your company.
Although this may sometimes provide greater tax relief, it also introduces additional complexity.
Rental income may need to be declared personally, and there can be implications for Capital Gains Tax, mortgage conditions and home insurance where part of a property is used exclusively for business.
For that reason, it’s generally worth taking professional advice before putting a formal agreement in place.
For many owner-managed companies, the £6 per week allowance provides a simpler, low-risk solution.
What changed from April 2026?
From 6 April 2026, employees can no longer claim tax relief directly from HMRC for homeworking expenses that haven’t been reimbursed by their employer.
The good news for most limited company directors is that very little has changed. Your company can still reimburse eligible homeworking costs, including the £6 per week homeworking allowance where the conditions are met.
In other words, the changes mainly affect employees making personal claims through HMRC rather than directors whose companies reimburse their expenses. The ACCA has published a useful summary of the changes here.
Keep good records
If your company pays the flat-rate allowance, record the payments in your accounting records.
If you are claiming actual additional household costs instead, keep supporting evidence such as utility bills together with notes explaining how the business proportion was calculated.
Good record keeping makes preparing your accounts much easier and provides evidence should HMRC ever ask how the figures were arrived at.
Do you need help with your expenses?
Many company directors either miss out on legitimate expense claims or aren’t sure what they can claim when working from home.
If you’re unsure what your limited company can claim, get in touch with the Integro team.
You can also read our complete guide to limited company expenses for a comprehensive overview of the tax-deductible costs available to limited companies.
