Many sole traders work from home, either full-time or alongside work carried out at customer sites. If you use part of your home for business, you may be able to claim some home working expenses.
The short answer is yes — sole traders can usually claim reasonable home working costs where there is genuine business use. However, the claim needs to be fair, supported by records and not mixed up with normal personal household costs.
What counts as working from home?
Working from home could include:
- Doing admin and bookkeeping
- Sending invoices
- Making business calls
- Storing paperwork
- Managing bookings
- Running an online shop
- Preparing quotes
- Working from a home office
- Creating content or marketing materials
Even if most of your work happens elsewhere, you may still do part of the business from home.
What expenses might be claimable?
Depending on how you work, you may be able to claim a business proportion of certain household costs.
These could include:
- Electricity
- Gas
- Broadband
- Phone costs
- Rent, where relevant
- Council tax, where relevant
- Home insurance, where relevant
- Repairs linked to the business area
You should only claim the business element, not the full household cost.
How do you work out the business proportion?
A fair method should reflect how much of the home is used for business and how often it is used.
For example, this might consider:
- The number of rooms in the property
- How many rooms are used for business
- How many hours the space is used
- Whether the room is also used personally
The calculation should be reasonable and consistent.
Can you use simplified expenses?
Some sole traders may choose to use simplified expenses for working from home. This allows a flat-rate claim based on the number of hours worked from home each month, instead of calculating actual household costs.
This can be easier for small businesses, but it may not always produce the highest claim.
The right method depends on your circumstances and records.
Common mistakes to avoid
Sole traders often make mistakes such as:
- Claiming the full broadband bill when it is partly personal
- Claiming household costs without a clear calculation
- Forgetting home working costs completely
- Using unrealistic proportions
- Not keeping bills or records
- Treating personal household spending as business spending
A reasonable claim is much easier to support if HMRC asks questions.
Why good records matter
You should keep evidence of household bills, business use and how the claim was calculated.
This could include:
- Utility bills
- Broadband bills
- Phone bills
- A note of hours worked from home
- A calculation showing the business proportion
- Records of business tasks completed at home
You do not need to overcomplicate it, but you should be able to explain the claim.
Final thoughts
Sole traders can usually claim home working expenses where there is genuine business use. The key is to make the claim reasonable, proportionate and supported by records.
If you work from home and are unsure what you can claim, Merranti Accounting can help you calculate expenses correctly and keep your records tax-ready.
Written by Steve Watts
