Originally posted by d000hg
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In summary:
* Yes, the business can pay for it. It's wholly and exclusively for business *purposes* (I only need it as I work mostly from home) although there may be small amounts of non business use. It's not a tax deductible expense in any case, and no capital allowances on buildings although fixtures and fittings, normal office furniture and installation costs should be deductible.
* The VAT on the building cost only should be reclaiable even on FRS as over £2k. No apportionment for any private use needed on FRS.
* Potential issue with BIK. In theory, it should be like any other business asset. So long as personal use is not "significant", which it shouldn't be, it should avoid a BIK charge. HMRC guidance is confusing as while it states that office buildings provided on your business premises are allowable, it says if provided at an employees home it is not. Confusing, as my home is also my business premises. Accountant seems to think it shouldn't be a problem as long as it is mainly used for business.
* Could potentially affect CGT on sale of home but unlikely to be an issue in practice due to small footprint and there still being the occasional element of personal use (it's a balancing act).
* Business rate liability needs to be checked but I've had discussions with the valuation office and they don't seem to think it will attract business rates so long as it's clerical work and no visitors.
I think that about covers it all! Hopefully useful for anyone else considering it. Here's my accountants own article on the subject:
http://jf-financial.co.uk/2014/10/22...mited-company/
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