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Yes - we use software that is compliant with Making Tax Digital. If you don’t want the stress or worry or setting up a new digital system, contact us today to see how we can ensure that your accounts are compliant with MTD.

If you have a business and work from home, you want to be able to claim the expenses associated with this business on your tax return. Work from home tax deductions can be a little confusing to get your head around. Usually, if you use something for your business, then you can claim that expense back. Life is rarely simple though, and neither are tax returns, so there are a few things to think about when working out your tax deductions. We’re here to tell you which home office expenses you can claim for, and how much, to help you out.

So, which of my home office expenses are tax deductible?

The working from home expenses which you can claim for are as follows:

• Mortgage
• Rent
• Council tax
• Light and heat
• Telephone and broadband
• Property repairs
• Water
• Your vehicle (including insurance, repairs, breakdown cover and fuel)

How much can I claim?

 There are two basic methods to calculating your tax deduction, which are:

1. Analysing the costs method

HM Revenue & Customs (HMRC) states that you need to apportion the running costs of your home on a “fair and reasonable” basis. This means splitting it fairly between the private element of the cost (the part that relates to your personal living costs) and the business element. Depending on the type of your business, how much you can claim for will vary. To proportion your home expenses accurately, HMRC has suggested guidelines to follow:

• Area: What proportion in terms of area of the home is used for business purposes?
• Usage: How much is consumed? This is appropriate where there’s a metered or measurable supply such as electricity, gas or water.
• Time: How long is it used for business purposes?

So, if this is your method of choice, you simply need to work out how many rooms you use in your house for business, and then calculate how much time you spend in the rooms. It’s best not to use a room solely for business, and no personal activities. Using a room for dual purpose will mean if you sell your house, capitals gain tax will be due on that room. You could use your office also as a music room, keeping your guitar and piano in there as evidence for any visiting HMRC inspectors. For example: Say you have four rooms in your home, one of which you use only as an office. Your electricity bill for the year is £400. Assuming all the rooms in your home use equal amounts of electricity, you can claim £100 as allowable expenses (£400 divided by four). If you worked only one day a week from home, you could claim £14.29 as allowable expenses (£100 divided by seven).

2. The simplified expenses method

This simplified method was provided by the government to “combat the complexity” of working out your home office expenses. Basically, you calculate your allowable expenses using a flat rate based on the hours you work from home each month. It’s easier as you don’t have to work out the proportion of business and personal use - but may not save you as much on tax. The amount varies with the number of hours you work per month at home, as follows:

• 25-50 hours: £10 per month
• 51-100 hours: £18 per month
• 101 hours or more: £26 per month

For example:  If you worked 40 hours from home for 10 months, but worked 60 hours during two particular months: 10 months x £10 = £100 2 months x £18 = £36 Total you can claim = £136 It’s important to note that this flat rate doesn’t include telephone or internet expenses. The process of claiming home office expenses can be a massive hassle for business owners. If you need a hand completing and filing your tax return, then call on us to help you out. We’ll make sure it’s done quickly, accurately and before the deadline.

We do understand that we're not a traditional accountancy firm and that our multi award-winning re-vamped way of working might not be everyone's cup of tea.  We think that most small businesses could benefit from a bit of Mazuma magic, but take a look at the reasons why we may not be right for you before you make a final decision! To make it easy we also explain how you can switch to us.

If you sign up with us part way through your financial year it is very likely that there will a catch-up of bookkeeping and accounts work to be done to get you up to date.   For example, if your financial year commences in April and you sign up with Mazuma in July, your first payment to us will be 4 x £monthly price to cover April, May, June and July.  Don't worry though. you can split your catch-up payment over the first three months of your contract if you like!  Once you're all up to date you will just pay your fixed monthly price.  In order for us to complete your year end accounts and tax returns we simply ask that you have been a client of Mazuma for one year or have made the equivalent of 12 monthly payments.

People often ask us how our accounting service can be so cheap, querying how we it's possible to be a cheap accountant who is also reliable and knowledgeable. Mazuma's structure means that you have the right person doing the right job so we can keep our fees as low as possible.  We make sure that our Chartered Accountants spend their time doing accounts and tax, not scanning and filing!  This means that they can work more efficiently, keeping your fees down.

Of course!  You will be allocated your own Accountant, who will always deal with your accounts and tax as well as any ongoing questions you may have.

When you sign up with Mazuma you'll be given details of how to contact your Accountant.  Our prices are fixed fee so you can be assured that no extra bills will appear as long as you use the service fairly.  You can get in touch with your Accountant in a variety of ways including email and phone.  All that we ask is for you to be aware that when you call you may be asked for a time that your Accountant can call you back.  We're sure that you'd want your Accountant to give your accounts their full attention, so if they are working on a few tricky tax calculations they will call you back when they have finished.