Anyone who runs a new home-based business will tell you that the hardest part of all is getting through the first couple of years and making sure your business keeps its head above water.
As accountants we now only too well that those first couple of years can determine whether a business lasts the course or falls by the wayside. That’s why we offer or clients the sort of tax-saving advice that will help then build a viable and sustainable business. Yet, in spite of this recent research from the Association of Certified Chartered Accountants (ACCA) has found that many home-based businesses are still not taking full advantage of the tax breaks on offer.
The ACCA has appealed to entrepreneurs in some of the UK’s most fertile hubs for home-based start-up business to make sure they are not missing out on a number of money-saving tax breaks. The ACCA has asked businesses in the South East and South West, areas which traditionally produce the highest numbers proportion of home-based start-up businesses, to make the most of these tax breaks if they want their businesses to thrive.
The ACCA estimates there are 356,823 home businesses in London: Wandsworth boasts 32,840 of them – equating to almost a fifth of the borough’s entire workforce. Similar figures show there are 254,377 home start-ups in the South West, with Caradon boasting 20% of its workforce as ‘at-home’ businesses.
Yet, the association believes many of these businesses are unaware of the sort of tax breaks they could, and should, be claiming.
Chas Roy-Chowdhury, the ACCA’s head of tax, has started a national campaign to raise awareness of the types of tax relief available to busy home businesses, which Steven Glicher accountants fully supports. Speaking in a recent press release he said:
“The rise in start-ups from the home is good news for the economy, but whether these home-based entrepreneurs are aware that, for example, they can deduct tax for the electricity they use in the room where they do most of their work is another matter.”
“Unless you are trawling through HM Revenue & Customs’ (HMRC) website, you may not know that even costs of hiring a cleaner can be deducted from your tax bill for the work they have done in the ‘business room’ of your home.”
“It is not always straightforward and it will not always be clear what can and cannot be allowed. Getting it wrong could land you in hot water with HMRC, so it’s worth going over [with the help of a qualified accountant] what is allowed and what isn’t.”
If your small home-based business would like help and information on this or any other tax matter, then contact Steven Glicher accountants on 0161 485 8007.