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Where Taxpayers and Advisers Meet
Tax Insider Tip: Claim Fixed Rate Deductions
09/09/2016, by Tax Insider, Tax Tips - General Tax
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To save some of the work incurred in keeping details of expenses, individuals carrying on a trade as a self-employed sole trader or in partnership with other individuals can instead claim fixed rate deductions.

Fixed rate deductions are available in respect of vehicle deductions, business use of home and in relation to business premises which are also used as a home.

Businesses can choose to claim the fixed rate deductions to save work.
 
Alternatively, they can keep records of actual expenditure and make the necessary apportionments between home and business use. Where records are kept businesses have the option of claiming a deduction for either the actual expense or, where this gives a more favourable result, claiming the fixed rate deduction.

Example:
Lucy works from home running a small business making soft toys. She works 30 hours a week.

To save paperwork, she claims a fixed rate deduction of £26 per month (the rate applicable where hours worked at home in a month are 101 or more) for use of her home for business purposes.

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About The Author

The above article is taken from 'Tax Insider,' TaxationWeb's own publication specifically for taxpayers and their advisors. 'Tax Insider' is a monthly magazine containing numerous tax tips, articles, questions and answers from leading tax experts, aimed at helping taxpayers to save tax and reduce their liabilities.

To register and download free copies of Tax Insider, and for details of special offers and how to order, visit: www.taxinsider.co.uk

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