Freelancers' Questions:Can I claim expenses for my cleaner?
Freelancer’s Question: I am a creative freelance consultant running my own limited company and mainly work from my home/registered office. One room is dedicated to business - my office - and I have a professional cleaner (a team of two people) service this twice a week. The cleaners also clean the rest of my apartment/registered office - the kitchen, lounge, bathroom, bedroom and hallway. At the moment, I am paying the cleaner out of my personal money. But as some of the payment (£20 for an hour, and I have two hours a week) applies for my office/business use, can I claim some of it as a business expense?
Expert’s Answer: I presume that you are an employee of this limited company, and perhaps also its shareholder and director. The property belongs to you and, at present, you work from one room and pay to have the office cleaned. As an employee, you are able to claim a deduction for expenses that are incurred wholly, exclusively and necessarily for the purposes of your employment.
But since you are also deriving a personal benefit from having the property cleaned, HM Revenue and Customs is likely to argue that there is a duality of purpose and, therefore, not an item on which you can claim a business deduction.
An alternative is for the cleaners to invoice the company directly and for a just and reasonable proportion - possibly based on time spent cleaning the non-office area over the total time charged - to be taxed on you as a benefit in kind.
And finally a word of warning: the issue with having a room in your property dedicated to business is that it may affect your Principal Private Residence Relief if you were ever to sell the property.
You should discuss the above points with a professional adviser before you decide to act on them alone.
The expert was Paul Spindler, a partner within the technology group at chartered accountants Kingston Smith.
Banksy editorial image by Dan Brady
25th November 2009