How to save money working from home
Running a home business or working remotely as self employed can be a cost effective way to run your business. Here are some quick tips to help you save money when you’re working from home.
Lower overhead costs
Overhead costs are things like rent, utilities, insurance and equipment that are ongoing expenses, not part of product production.
When you run a business from home, you don’t have to pay rent or utilities on a separate business premises. While you may need separate insurance if your business isn’t covered by your home insurance, you can still make a saving. You also may not need to pay business rates, although there are some exceptions you can read more in our business rates guide.
Avoid travel costs
When you work from home, you won’t spend money commuting to work. If you do need to travel for business reasons, for example to visit a client not commuting to your workplace, you can claim this as an expense on your tax return.
Use what you already have
If you already have equipment to help run your business at home, like furniture and technology, you won’t need to buy anything new.
If you do need specific equipment to run your business or to make moderations to your home, you can shop around to find a good deal. Some new equipment that you buy can be treated as allowable expenses on your tax return too.
Don’t forget about allowable expenses
Even if you run a home business, you can still claim a reasonable proportion of your costs as expenses on your tax return. So, your tax bill will be reduced. This is based on how much you use the expense for your business.
If you’re working from home, expenses that are likely to be split include:
- Telephone and internet
- Electricity and heating bills
- Mortgage or rent
- You can only claim for water if it is used significantly for the purpose of your business
To work out which proportion of your expense you can claim, there are different methods. For example, you could see what proportion of your home is used for business, and what proportion of time it is used for business to work out your claim. Find out more about claiming expenses in our guide.
Keep an eye on your finances
When you do your accounting regularly, you’ll have all the information to need to help make the right decisions for your business.
We have everything you need to help you prepare for your Self Assessment tax return, submit your VAT Return for Making Tax Digital and keep the right financial records. You can invite your accountant to work with you in Bokio, or we can help you find one if you need a helping hand.
Accounting is kept simple with Bokio, so you have more time to spend running your business.