Can I claim expenses for business storage or rented space?

Understanding what “business storage” means for expenses

Business storage or rented space expenses come up in lots of everyday situations: you rent a small lock-up for tools, you pay for a self-storage unit to hold seasonal stock, you lease a corner of a warehouse for pallets, or you hire a document storage company to archive records. The common thread is that you are paying for space (and sometimes services around that space) to support your business activity.

When you ask, “Can I claim expenses for business storage or rented space?” you are really asking whether the cost is allowable as a business expense and how to treat it for tax and bookkeeping. In general, storage and rented space costs can be claimable when they are incurred wholly and exclusively for business purposes. The more directly the space is tied to earning business income, the easier it is to justify. The more mixed the use (business and personal), the more careful you need to be.

This article breaks down what typically counts as claimable storage, the kinds of fees you can include, how mixed-use situations work, what to do if you store goods at home, and how to keep records that stand up if you ever need to explain your claim. Although rules vary by country and by business structure, the principles below will help you think clearly about whether a storage cost is genuinely a business expense and how to handle it sensibly.

The key test: is the expense genuinely for business?

The simplest way to decide if you can claim a storage or rented space expense is to ask three practical questions:

First, why are you paying for the space? If the reason is to store business stock, tools, equipment, documents, or materials needed to deliver work, that points strongly toward an allowable expense.

Second, who benefits from the space? If it primarily benefits the business—helping you fulfil orders, complete jobs, keep inventory safe, or meet compliance needs—again that supports claiming it. If it mostly benefits you personally—decluttering your home, storing personal furniture, keeping a hobby collection—then it is not a business expense, even if you occasionally put a business item in there.

Third, is the cost reasonable in relation to your business needs? “Reasonable” doesn’t mean “cheap,” but it does mean you should be able to explain why this size and type of storage makes sense. Renting a small unit to hold tools is easy to defend. Renting a large warehouse for a part-time side hustle with minimal stock could raise questions unless you have clear reasons (for example, you are scaling, you need secure space for high-value items, or you have bulky goods).

If the answer to these questions clearly points to business use, you are typically on solid ground. If it’s mixed, you’ll likely need to apportion (split) the cost.

Common claimable scenarios for storage and rented space

Storage expenses often arise because a business needs space beyond what the owner has at home or at a main workplace. Here are common situations where costs are typically considered business-related:

Storing stock or inventory

If you sell products and need somewhere to keep stock, a storage unit, warehouse space, racking area, or container rental used for inventory is usually a straightforward business expense. This includes space for raw materials, finished goods, packaging supplies, and promotional materials used for sales.

Storing tools and equipment

Tradespeople, photographers, event professionals, mobile hairdressers, and many others often need secure storage for tools, kit, and equipment. If you rent space primarily to keep your working equipment safe and accessible, the rental and related costs are commonly claimable.

Document and records storage

Many businesses must keep records for a certain period. If you pay for document storage, off-site archiving, secure shredding add-ons, or digital indexing as part of a document storage service, those costs can usually be treated as business expenses, provided they relate to business records.

Overflow space during growth or seasonal peaks

Some businesses only need extra space at certain times—holiday stock, summer event kit, or seasonal equipment. Short-term storage rented to manage fluctuating demand is typically business-related as long as it’s used for business items.

Rented workspace that isn’t a “traditional office”

Sometimes “rented space” is not storage in the narrow sense. It might be a small workshop, studio, garage, industrial unit, or shared warehouse bay where you both store items and do some work. If you rent it for business operations, the rental cost can often be claimed, and there may be additional considerations for utilities, service charges, and improvements.

What costs can be included as part of storage or rented space expenses?

People often think only the monthly rent is relevant, but storage and rented space arrangements may include a range of charges. Depending on how the contract is structured, you may be able to claim some or all of the following when they are incurred for business purposes:

Rent or storage fees

The core monthly or weekly fee for the unit, bay, container, or area you rent is typically the main expense. If the unit is used purely for business, you can generally claim the full amount.

Deposits and admin fees

Deposits can be tricky. If the deposit is refundable and you expect to get it back, it’s not really an expense at the time you pay it—it’s more like money held by the landlord or storage company. Administration fees, setup fees, or one-off charges that are not refundable are more likely to be treated as expenses. In practical bookkeeping terms, it often helps to separate refundable deposits from non-refundable fees so your accounts reflect what you truly spent.

Insurance for stored items

Many storage providers require insurance or offer it as an add-on. If the insurance is for business items stored there, it is commonly treated as a business insurance expense. If you insure a mix of personal and business items, you may need to apportion.

Security and access fees

Charges for alarms, gate access, security staff, access cards, out-of-hours entry, or enhanced security typically relate to the storage service. If the storage is for business use, these may be claimable as part of the cost of maintaining the space.

Utilities and service charges

For a workshop or rented unit, you might pay separate utilities such as electricity, water, heating, internet, waste disposal, or a building service charge. If these are necessary for your business operations in that space, they are usually considered business expenses. Where you do some personal activity in the unit (uncommon, but possible), apportionment may be needed.

Maintenance and minor repairs

If you are responsible under the lease for minor maintenance or repairs—replacing a lock, fixing minor damage, servicing a shutter—these costs can often be claimed when they are your obligation and relate to keeping the rented space functional for business use. Larger structural repairs may be the landlord’s responsibility, but if you pay for significant works, you may need to consider whether it is a repair (often deductible) or an improvement (often treated differently).

Racking, shelving, and storage equipment

Racking and shelving are not “rent,” but they are common purchases associated with storage. Whether you can claim them, and how, depends on whether your system treats them as day-to-day consumables or assets. In many cases, durable items like shelving are treated as equipment rather than a simple expense. Even when they are not claimed as immediate running costs, they may still be claimable through capital allowances or depreciation rules (depending on where you are and your accounting approach).

Delivery, van hire, and transport to move items in and out

Costs to move business goods into storage—van hire, fuel, courier fees, pallets, or a removal service—can be claimable when incurred for business. If you are moving personal items too, you should split the cost in a fair way, such as by volume moved or by separate invoices where possible.

Mixed-use storage: when business and personal items are both stored

Mixed-use storage is a common grey area. For example, you rent a unit mainly for business stock but also store personal furniture; or you keep personal items in one corner of a workshop you rent. The question becomes: can you claim the whole cost, part of it, or none of it?

In most systems, you can only claim the portion that relates to business use. That means you need a reasonable method to apportion the cost. The method should be consistent, sensible, and ideally supported by some evidence. Here are practical ways to do that:

Apportion by floor area or volume

If you can identify that, say, 70% of the unit’s space is taken up by business items and 30% by personal items, then claiming 70% of the rental and related costs may be reasonable. This works best when the split is stable over time and you can show how you arrived at the estimate.

Apportion by time

Sometimes the unit is used for business only in certain months—perhaps you store seasonal stock for three months of the year, then use the space personally for the remaining months. In that case, apportioning by time (claiming only the months that are business-related) can be appropriate.

Use separate units (best practice when feasible)

The simplest way to avoid apportionment disputes is to keep business and personal storage separate. If your budget allows, renting a small business-only unit and keeping personal items elsewhere makes record-keeping easier and reduces the risk of accidentally overclaiming.

Be honest about “incidental” personal use

If personal items are truly incidental—perhaps one small box tucked away temporarily—some people are tempted to ignore it. The safer approach is to keep the unit business-only where possible. If you do mix items, document it and apportion fairly. Overclaiming because “it’s mostly business” can be costly if questioned later.

Storage at home: can you claim a portion of your home costs?

Not all storage is rented externally. Many people store business items at home: inventory on shelves in a spare room, tools in a garage, packaging in a cupboard, or paperwork in filing cabinets. This can raise a different question: rather than claiming a separate rental cost, can you claim part of your home expenses because you use your home for business storage?

In many tax systems, using part of your home for business may allow you to claim a portion of certain home costs (for example, utilities or rent) when the use is demonstrably business-related. However, the rules and consequences vary widely. In some places, claiming home costs can have implications for capital gains on sale of the property or may require careful calculation. Because of that, it’s important to treat home-use claims thoughtfully.

From a practical point of view, business storage at home is easier to justify when you can show that:

1) You store items that are clearly business-related (stock, tools, records),

2) The space used is identifiable (a specific room, a defined garage area, a dedicated shed), and

3) The business use is regular and not trivial.

Many people choose a simple, conservative method: claiming a small, proportionate amount of home running costs based on area and time. Others keep it even simpler and claim nothing for home storage, especially if the amounts are small and the record-keeping burden outweighs the benefit.

If you rent space from a family member or yourself, does that change things?

Sometimes the rented space is not from a commercial provider. You might rent a garage from a relative, pay your partner for use of a shed, or lease a small room from a friend. In principle, an expense can still be business-related even if paid to someone you know, but these arrangements require extra care.

The key is that the arrangement should be commercial in nature:

There should be a clear agreement about what is being rented, how much is being paid, and what the payment covers. The rate should be reasonable compared to local market rates for similar space. You should pay the rent in a traceable way (bank transfer is better than cash). And you should keep records that show the space is actually used for business storage.

If you pay an amount that is obviously inflated, or if the arrangement looks like a way to shift money to a family member without genuine business need, it is more likely to be challenged. Keeping it straightforward and market-based helps.

Is a storage unit an “office”? Why the label matters less than the use

People sometimes worry that because a storage unit isn’t an “office,” it won’t count as a business expense. In most practical scenarios, the label matters less than the function. If the rented space is used to support your business—storing items you need to sell or to do your work—the cost is usually considered part of your business overhead.

That said, how you describe the expense in your books can influence clarity. Rather than calling everything “rent,” you might separate “Storage rent,” “Workspace rent,” “Warehouse fees,” or “Document storage.” Clear categories help you understand your business costs and can make it easier to explain your accounts if asked.

Storage for vehicles, trailers, and equipment: special considerations

Some businesses rent space to store vehicles, trailers, or large equipment—think catering trailers, landscaping equipment, mobile clinics, or market stalls. These costs can be claimable when the items are used for business. The same mixed-use principles apply: if the vehicle or trailer is also used personally, then the storage cost may need to be apportioned.

A common pitfall is claiming storage for a vehicle that is mostly personal but occasionally used for business. If the business use is minor, claiming the full storage cost can be hard to justify. A more defensible approach is to claim the business-related proportion or to keep a clear separation between business and personal vehicles and equipment.

What about storing items “in advance” before the business starts?

Sometimes you start incurring storage costs before you officially launch—buying stock early, building up equipment, or storing materials while you set up. Whether those costs are claimable depends on how your local rules treat pre-trading or pre-commencement expenses.

From a practical standpoint, the main issue is whether the costs are genuinely connected to setting up a business that then begins trading. If you can show that the storage was part of preparing for the business—storing initial stock, safeguarding equipment, organizing materials—and the business did commence, those costs may be treated as allowable in some form. If the business never starts, the costs may be harder to justify as “business expenses” because there is no business activity to connect them to.

Claiming storage for client goods: who owns the items matters

Some businesses store goods that belong to clients. For example, a logistics company holds customer stock, a repair shop stores client equipment awaiting work, or a contractor keeps client materials on site. If you pay for space to store client goods as part of your service, it is typically a business cost.

However, consider whether you are being reimbursed. If you charge clients a separate storage fee, you may record the rental cost as an expense and the client storage fees as income. If the client reimburses you exactly, it may net off, but you still want to record both sides accurately to reflect the true flow of money.

How to handle storage costs in your bookkeeping

Good bookkeeping isn’t just about compliance; it also helps you understand your profitability. Storage and rented space expenses can be tracked in a few clean ways:

Create a clear expense category

If storage is material to your business, set up a dedicated category such as “Storage rental,” “Warehouse rent,” or “Off-site storage.” This makes it easy to see how much you spend on space and whether it’s growing over time.

Separate rent from related costs where useful

If your storage provider charges insurance, admin fees, late fees, or supplies, consider whether splitting those lines is helpful. For instance, insurance might sit under “Insurance,” while access fees and rent sit under “Premises costs.” The goal is clarity, not complexity.

Track mixed-use allocations explicitly

If you apportion the cost, record the full invoice and then record the business portion you are claiming, with a note explaining the percentage. Keeping a small calculation note (for example, “70% business based on measured racking area”) can save a lot of time later.

Keep an eye on late fees and penalties

Storage companies may charge late payment fees or penalties for contract breaches. Whether these are allowable varies by rules and context, but even aside from allowability, they are costs you generally want to avoid because they don’t add business value.

Records you should keep to support your claim

When you claim any business expense, you should be able to show what you paid, when you paid it, and why it was for business. Storage and rented space expenses are no different. Useful records include:

A copy of the rental agreement or storage contract showing the address, unit number (if applicable), dates, and terms.

Invoices or monthly statements from the provider showing the fees and what they cover.

Proof of payment, such as bank statements or card receipts.

Evidence of business use, especially if there could be doubt. This might include photos of the unit showing business stock or equipment, inventory lists, delivery notes, or a simple log of what is stored and when items move in or out.

For mixed-use situations, keep a note explaining your apportionment method, updated if circumstances change.

You don’t need to overdo it, but you do want to avoid a situation where your only “proof” is a vague memory that the storage was “mostly business.”

Reasonableness and risk: how to claim without creating problems

If you want to claim storage costs confidently, a conservative mindset helps. That doesn’t mean underclaiming everything; it means claiming what you can justify and documenting the logic.

Here are ways people accidentally create risk:

Claiming a full unit rental while using a large chunk of it for personal belongings.

Claiming storage for items that are not clearly related to the business, such as personal furniture, memorabilia, or household appliances.

Claiming rent for space that is rarely used and not necessary for the business.

Paying cash without receipts or using informal arrangements with no documentation.

Using vague descriptions in accounts that don’t match the true purpose of the space.

And here are ways to reduce risk:

Keep business storage separate from personal storage where possible.

Use clear invoices and traceable payments.

Maintain a simple inventory or list of what is stored.

Apportion mixed-use costs fairly and consistently.

Review the arrangement periodically to ensure it still makes sense.

Storage costs vs. improvements: what if you fit out the space?

Sometimes you rent a unit and then spend money making it more suitable—installing better lighting, adding extra locks, painting walls, building a mezzanine, or fitting heavy-duty racking. The tax and accounting treatment can differ depending on whether the spend is considered a repair/maintenance (keeping something in working order) or an improvement (making it better than it was).

As a practical rule of thumb, small, routine fixes are more likely to be treated as running expenses. Larger projects that significantly enhance the space or add lasting value are more likely to be treated as capital in nature. Even if you can’t deduct the full cost immediately as an expense, it still may be claimable over time under asset rules.

If you are planning significant works, it’s wise to keep detailed invoices and to describe the work clearly. It is also helpful to separate items where possible—for example, racking purchased as equipment versus structural changes to the premises—so your records reflect what you actually did.

What if you work in the rented space as well as store items?

Many small businesses operate from a hybrid space: a unit where you store stock and also pack orders, a workshop where you store tools and build products, or a studio where you store materials and produce creative work. In these cases, the expense is still generally business-related, but you may have additional cost categories such as utilities, business rates, cleaning, and safety compliance.

The key is to match the costs to the business use. If the space is exclusively business, then the rental and related costs are usually straightforward. If you sometimes use the space personally (for example, for a personal hobby or storing personal items), you may need to apportion again.

Also consider practical issues: if you have employees, if the public visits the premises, or if you store hazardous materials, there may be extra legal and insurance responsibilities. These aren’t “tax rules” as such, but they can affect what costs you incur and how you justify them as necessary business expenses.

Examples to help you decide what you can claim

Sometimes examples make the principles clearer. Here are a range of scenarios and how you might approach them:

Example 1: Online seller renting a small storage unit for inventory

You sell products online and rent a 25 sq ft unit solely for stock and packaging. You pay monthly rent and insurance. This is a classic business expense scenario. If everything stored there is business-related, you would typically claim the full rent and the insurance costs as business expenses.

Example 2: Tradesperson renting a lock-up for tools but storing personal items too

You rent a garage to store tools and materials, but you also keep a personal motorbike and some household boxes there. You can still claim, but you should split the cost. You might estimate the business use at 60% based on floor area occupied by tools and racking. You would claim 60% of the rent and any related fees that apply to the whole unit.

Example 3: Freelancer storing paperwork at home

You keep client files and business records in a dedicated filing cabinet in your home office. You don’t rent external storage. Whether you claim anything depends on your approach to home working costs. If you already claim a portion of home costs for a home office, you may already be covering it. If you don’t, you might decide the additional benefit of claiming a tiny amount for storage is not worth the complexity.

Example 4: Renting a workshop used only for business

You rent a small workshop where you make products and store raw materials. The lease includes a service charge and you pay utilities. Because the space is used purely for business, you would generally treat rent, service charge, and utilities as business expenses, and you would keep all invoices and payments on file.

Example 5: Storing a business trailer that is sometimes used personally

You have a trailer used mainly for business events but occasionally for personal moves. You rent a space to store it. A careful approach is to estimate business use (for example, based on mileage, number of events, or days of use) and claim the same proportion of the storage cost. If personal use is minimal, you still might apportion to stay on the safe side.

How to decide whether external storage is “worth it”

Even if you can claim storage costs, the business question is whether paying for storage improves profitability or reduces risk. Claimed expenses reduce taxable profit, but they still cost real cash. So it can help to evaluate the cost in business terms:

Does the storage allow you to hold more inventory and avoid stock-outs?

Does it save time packing orders or completing jobs?

Does it reduce damage or theft by keeping items secure?

Does it allow you to keep your home usable and maintain boundaries?

Does it enable compliance, such as keeping records securely?

If the answer is yes, storage may be a sensible operational cost rather than a “nice to have.” If the answer is no, you might be paying for space you don’t truly need.

A practical checklist before you claim storage or rented space expenses

If you want a simple way to sanity-check your claim, run through this checklist:

1) The space is used to store business items or to support business operations.

2) You have a contract or invoice that shows what you pay and for what period.

3) You pay in a traceable way and keep proof of payment.

4) If there is any personal use, you have a fair apportionment method and a note explaining it.

5) The cost is proportionate to your business needs, and you can explain why you need the space.

6) You keep basic evidence of business use (photos, inventory lists, delivery notes, or a log).

Final thoughts: yes, often—if you can justify the business use

In many cases, you can claim expenses for business storage or rented space. The most important factor is that the cost is genuinely for business purposes. Pure business use is the simplest: rent a unit for stock or equipment and claim the cost. Mixed-use is still possible, but it requires a fair split and clear records. Storage at home can sometimes be reflected through home-use claims, but it should be approached carefully because rules vary and the administrative effort may not always be worthwhile.

If you keep your storage arrangements clean—business items stored for business reasons, paid for with clear invoices and traceable payments—you will usually find that storage costs are among the easier business expenses to justify. The moment personal use becomes significant, treat the claim like a shared cost: be honest, apportion sensibly, and document the logic. That way, you get the benefit of claiming what you’re entitled to without creating avoidable risk.