Business costs on a B&B run from home

by **Bumblebee** on Tue Jan 24, 2012 7:35 pm

I am in the second year of running a self-catering B&B business from part of our home. The first year the income was miniscule and I didn't bother setting any costs against the income, just declared the lot! The second year is a different matter as we had a really busy spring and summer season during 2011

. Does anyone know how I calculate the percentage of council tax, electricity and heating bills I can claim as a business expense? I do my self-assessment tax returns myself and am not sure what is reasonable to put down as business expenses vs income. Our house only has two bedrooms, and effectively we let out one third of the house..should I be using 33% :?:

Any help gratefully received. Thank you.

by **pawncob** on Tue Jan 24, 2012 10:38 pm

http://www.hmrc.gov.uk/manuals/bimmanual/BIM47800.htm

http://www.hmrc.gov.uk/manuals/bimmanual/BIM47815.htm

by **Bumblebee** on Fri Jan 27, 2012 6:10 pm

Thanks for the links.

I note from this that I don't have to worry about paying business rates because of the following quote "There will however be exceptions. For example, bed and breakfast establishments with fewer than six tenants do not pay the business rate."

From reading the other pages I assume that apportioning council tax, electricity, water on a percentage of the floor area used by the B&B and the time aspect will suffice? How exactly do I calculate this? Say the B&B is occupied 50% of the year, and the floor area is 33% of the total. My council tax is £1600 pa 50% of that is £800 and 33% of that is £266.66???

The part of the building used for the B&B is covered by oil central heating, whilst the bit we live in is heated by a stove. The oil heating is only used for the guests. It would seem reasonable to me that I can claim all the costs of the oil heating against the business income???

Thanks again for your patience & assistance.