Can I Claim a Garden Office as a Business Expense?

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Can I Claim a Garden Office as a Business Expense?

Are you looking to set up a garden office? 

Many people who work remotely have found that having a space away from their main house can help them focus on being more productive. It can also be an ideal setting to work in if you have a busy household. 

However, there is one query that many people have. As building a garden office is no minor feat, many people want to know if it can be claimed as a business expense. Here, our expert team at UK Garden Buildings will answer that question, so you can choose the perfect garden office while knowing all there is to know about the associated costs! 

Structures and Building Allowance

Introduced in 2018, the Structure and Building Allowance allows businesses to claim 3% on qualifying expenditure for construction. 

So, when you are asking, 'can I claim a garden office as a business expense?' you may be surprised to learn that the answer is no. This allowance does not apply when building a garden office, as the allowance prohibits any tax relief for structures built on residential property. 

There is also no current allowance that can be used to reduce the costs of planning or legal fees that can come from building garden rooms. So, if you run a limited company be aware that building and planning an office space will not help reduce your corporation tax bill. However, if you are looking to sell your home in the future, having a structure that looks great and was designed by our team at UK Garden Buildings will help to increase the selling price of your property.

Capital Allowance and Business Expenses

OK, so you won't be able to claim the initial costs for a garden office or the planning costs. However, a capital allowance covers everything from thermal insulation to electrical, wiring, plumbing, and cooling. In a similar vein, when it comes to running a radiator, an internet connection , or lighting, this can be covered under business expenses.

VAT

If you are buying your garden office through a limited company, and the company is VAT registered, you can reclaim VAT on some of the materials and services. 

You will need to ensure that you are only using the garden office space for business purposes to claim all of the VAT back after the build. If you were to buy a garden office through your limited company and use the space for personal business, you would be likely to incur the amount you pay on personal income tax, as well as how much national insurance you would need to pay at the end of the tax year. So, make sure you don't use the space for sleeping, exercising, or reading (unless those things are work-related!)