Office building costs and tax

[daltontrees]

Any pointers on this please? I have built an office in the garden, will be used only for the business. Built from scratch by me, just got a pile of receipts for concrete, timber, windows, electrical fittings, plasterboard etc. Around about £3k but if I was honest about the time spent on it by me even at a day rate of £150 it's more like £6k all-in. Question is, how can I approach this for tax? Do I claim the receipted costs as capital allowances (heard of them but don't know what they are really), do I pay myself to do the work and charge it to the company (i.e. me)? Or pay for the whole thing personally and rent it to the business and claim the rent as a business cost?

 

It's not a lot of money but I'd rather not pay tax on it if there is a legit way not to.

[daveatdave]

ask your accountant 

if you rent it to your business it will be classed as a second income to you and tax will have to be paid also business rates maybe payable to your local council 

[daltontrees]

I don't have an accountant and already the whole thing is feeling a bit too complicated for the scale of my business.

 

I've looked into capital allowances, buildings are not eligible. I might be abe to put depreciation through on it though. And repairs, although I very much hope there won't be any repairs needed for a long time.

[kevinjohnsonmbe]

There isn't a short, simple or particularly 'pleasing' answer to this Jules. 

 

Ill have to think it through and look some bits up. 

 

 

[Mark J]

7 hours ago, daltontrees said:

I don't have an accountant and already the whole thing is feeling a bit too complicated for the scale of my business.

 

I've looked into capital allowances, buildings are not eligible. I might be abe to put depreciation through on it though. And repairs, although I very much hope there won't be any repairs needed for a long time.

Get an accountant.

[kevinjohnsonmbe]

There are too many variables to try and put a sensible answer together Jules but....

 

It's not an uncommon situation and has been well debated at https://www.accountingweb.co.uk/any-answers/office-building-in-garden-vat-treatment

 

It's a pretty simple process of registration and it's a really useful resource.