What expenses can I claim if I run my business from a rented property?

Understanding what it means to run a business from a rented property

Running a business from a rented property is incredibly common. You might be self-employed and working from a flat, operating a limited company from a rented house, freelancing from a spare bedroom, or managing an online shop from a small rented studio. The tax rules and record-keeping expectations are generally designed to be practical: if an expense is incurred “wholly and exclusively” for business purposes, it is usually claimable. Where an expense is partly personal and partly business, you can often claim the business proportion, as long as the split is reasonable and you can support it.

In a rented property, the key question is usually not “Can I claim anything?” but “How do I calculate the business element fairly?” A rented home is a mixed-use space by default: it is where you live, and it is where you work. That mixed use shapes what you can claim, how you calculate it, and what kind of evidence you should keep. This article walks through the main categories of expenses, the different methods for calculating the business share, and the practical steps that help you claim confidently without over-claiming.

Two essential tests: business purpose and reasonable apportionment

Before listing specific expenses, it helps to frame the logic. Most claimable costs fall under two broad ideas:

1) The expense must relate to the business. If you pay for something only because the business exists (for example, a specialist business insurance policy), it’s usually straightforward. If you would have paid it anyway as a private individual (for example, rent for the home you live in), then only the business portion can be claimed.

2) If there is mixed use, the business portion must be calculated reasonably. “Reasonable” doesn’t mean perfect, but it does mean defensible. A sensible method applied consistently is often better than a complex method that you can’t evidence. You should be able to explain your method in plain English and show your workings if asked.

With those two tests in mind, let’s explore the main expenses people claim when running a business from a rented property.

Rent: can you claim part of your rent?

Rent is usually the biggest cost in a rented property, so it is also the expense most people ask about first. In many cases, you can claim a portion of the rent as a “use of home” expense if part of the property is used for business. However, because you are paying rent to live there, rent is almost always a mixed-use cost. That means you typically claim an apportioned share rather than the full amount.

A common method is to apportion rent based on:

Room basis: Divide the property into rooms, then claim the fraction that relates to the room(s) used for business.

Time basis: If the room is used for both living and working, reduce the claim to reflect the hours or days it is used for business.

For example, if you have a three-room flat (excluding kitchen and bathroom, if you choose to treat them as non-business rooms), and you use one room as a home office for 50% of the time (because it’s also a guest room), you might claim 1/3 x 50% of the rent. The important thing is consistency and a sensible rationale.

However, there are practical cautions. Some tenancy agreements restrict business use of the property, especially if it increases footfall, noise, or changes the nature of the premises. Even if tax rules allow a claim, you should ensure you are not breaching your lease. For many low-impact businesses (remote services, admin work, online consultancy) this is rarely a problem, but it’s worth checking your tenancy terms.

Council tax or local property taxes: can you claim a portion?

If you pay council tax or a local equivalent (depending on where you live), this is another cost that may be partly claimable. Like rent, it is primarily a personal living cost, so it is usually claimable only to the extent that it relates to business use of your home.

In practice, many people apportion council tax using the same method they use for rent (room basis and time basis). If your business use is small, the business element may be modest, but it is still often legitimate. Keep in mind that if your business use is minimal, you may decide the administrative effort is not worth it and opt for a simplified method (discussed later).

Utilities: electricity, gas, water, and other household services

Utilities are among the most common “use of home” claims because business activity can clearly increase usage. If you work from home, you heat the space during business hours, turn on lights, power computers, and potentially use more water. In a rented property, you might pay utilities directly or they may be included in your rent. Either way, if you can identify a business portion, you may be able to claim it.

Electricity: Often a significant claimable item, especially if you run computers, monitors, printers, studio lighting, or other equipment. A reasonable approach might include a room/time apportionment or a usage-based approach (for example, estimating the proportion of total electricity used by business equipment and working hours).

Gas (or other heating fuels): Usually claimed by apportioning the cost based on the business use of the heated space and time. If you heat the entire home and only use one room for work, a room/time approach is typically reasonable.

Water: If your business materially uses water (for example, hairdressing, beauty treatments, food preparation, cleaning services operated from home), then you may have a larger claim. If your business is primarily computer-based, the business portion of water is often small but can still be claimed if you apportion reasonably.

Broadband and phone services: These are covered in more detail below because they have their own common pitfalls, especially when contracts bundle services together.

Internet and phone: how to claim without over-claiming

Internet and phone expenses are frequently claimable when you run a business from a rented property, but the way you claim depends on whether the service is:

Business-only: If you have a dedicated business phone line or a separate broadband contract used exclusively for business, it is usually straightforward to claim the full cost.

Mixed-use: If you use the same phone and broadband for both business and personal purposes, you typically claim only the business proportion.

A practical approach for mixed-use phone bills is to review itemised bills (if available) and identify the business calls. For broadband, itemisation is not usually possible, so a proportion based on working time versus personal time can be reasonable. For example, if you use the internet heavily for business during working hours but also stream entertainment in the evenings, a split might be justified. If your usage is roughly similar, a simpler apportionment method may be more appropriate.

Bundled services can complicate things. If your rental property includes broadband as part of the rent, you may need to estimate the value of the included service or simply treat it as part of the overall “use of home” calculation. If you pay for a package that includes TV subscriptions or entertainment features, the personal element may be significant, so you should avoid claiming the full package unless it is genuinely for business.

Home office equipment and supplies

Beyond household running costs, you may be able to claim expenses for items used in the business, especially if they are exclusively for business. This category often splits into two types: “consumables” and “equipment.” The exact tax treatment can vary by jurisdiction, but as a practical matter you should track what you buy, why you bought it, and how it’s used.

Consumable supplies: Items like printer paper, ink cartridges, postage, packaging materials, notebooks, pens, and cleaning products for a workspace are commonly claimable when they are used for business. If you buy them for both personal and business use, you should claim only the business portion.

Small equipment: Items such as a keyboard, mouse, webcam, headset, desk lamp, ergonomic chair, or small shelving may be claimable if they are for business use. If the item is used privately as well, apportionment may be necessary.

Computers and major equipment: Laptops, desktop computers, high-end monitors, specialist tools, and machinery used for the business are often claimable, but they may be treated differently from ordinary running costs. In many systems, larger assets are not deducted the same way as day-to-day expenses. You may need to treat them as capital items and claim them over time, or under specific allowances. Even if you are unsure of the technical label, the practical point is: keep the receipts, note the business rationale, and be ready to explain how much of the use is business versus personal.

Furniture: A desk, office chair, or filing cabinet used in a dedicated work area can often be claimed. If you buy a sofa or décor for a room that’s mostly personal, it may not qualify. Where it is mixed-use, you may need to consider whether the purchase is genuinely for the business or mainly for the home.

Repairs, maintenance, and cleaning: what counts in a rented property?

Repairs and maintenance can be tricky in a rented property because responsibility is often split between landlord and tenant. You may pay for minor repairs, maintenance, or cleaning, but some of these costs are personal and some may be business-related.

General home repairs: If you pay to fix something in the property (for example, a broken door handle) that benefits the entire home, it is generally a personal cost. You might claim an apportioned business element only if your business use is significant and you can justify the business share. In practice, many people do not claim a portion of general repairs unless the business use is substantial or the repair relates clearly to the workspace.

Workspace-specific repairs: If you pay to repair something used solely in your business space (for example, replacing a lock on a filing cabinet used for business documents), that is more clearly claimable.

Cleaning: If you pay for cleaning services, the personal element is usually dominant. If you have a dedicated workroom that requires additional cleaning due to business activity (for example, a therapy room or a product assembly space), you may be able to claim a proportion. If your business creates extra waste or mess, you might be able to claim costs that are directly attributable to the business (for example, disposal of business packaging).

Repainting and redecorating: In a rented property, landlords often control major redecoration. If you do pay to paint or redecorate, whether it is claimable depends on why you did it and what it relates to. Painting a room purely to make it a better business workspace might be partly claimable, but if it also improves your living environment, it is mixed-use. Additionally, you should consider whether you have permission under your tenancy.

Insurance: home insurance, contents cover, and business policies

Insurance is often overlooked, but it can matter. In a rented property you may have renter’s contents insurance, and you may also need specific business cover depending on what you do.

Contents insurance: If your contents insurance covers both personal belongings and business equipment, you may be able to claim the portion relating to business assets. If you can identify the incremental cost of adding business equipment to the policy, that can be a clean way to justify the business share.

Business insurance: Some businesses require professional indemnity insurance, public liability, employers’ liability, or cyber insurance. These are typically business-only costs and therefore straightforward to claim. If your landlord requires certain insurance and you pay it as part of the rental arrangement, examine whether it is personal or business, and claim appropriately.

Special cases: If clients visit your rented property (for example, you run a small studio, tutoring space, or therapy room), you may need additional cover, and that additional cost is usually business-related. Always check your lease and insurer terms if you intend to receive clients, because both landlord and insurer may have restrictions.

Business rates or permits: when home business triggers extra charges

Most people running a low-impact business from home will not trigger separate business rates or permits. However, some activities can change how the property is treated by local authorities or landlords. If a portion of the property is treated as business premises (or you require a license or permit to operate), the costs associated with those requirements may be claimable as business expenses.

If your local authority charges a fee for a home-based business registration, signage permission, waste disposal arrangements, or inspections, those fees are generally business-related. The key is that the expense arises because of the business, not because you live there.

Travel and mileage from a rented home base

While not a “rented property” expense in the narrow sense, travel costs often intersect with a home-based business because your home may be treated as your base of operations. If you travel to meet clients, attend a coworking space, visit suppliers, or go to a business event, the travel may be claimable if it is for business purposes.

It’s important to distinguish commuting (travel to a regular workplace) from business travel (travel to clients, temporary sites, or business events). If your rented property is your main place of business, some journeys may qualify as business travel that would not qualify if you had a separate permanent workplace. Keep mileage logs or receipts and note the business purpose of each journey.

Storage and workspace: claiming costs when you use space for stock or equipment

If you run an e-commerce business, craft operation, or service business with tools and stock, you may use part of your rented property for storage. In many cases, this can support a stronger “use of home” claim, especially if you dedicate a room or area to stock, packaging, or equipment.

Possible claimable costs include:

Proportion of rent and utilities: If you use a room primarily as a stock room, you may claim a portion of rent, heating, and electricity based on space and time.

Storage equipment: Shelving, storage boxes, label printers, packing stations, and other items used to manage inventory can be business costs.

Incremental costs: If your business requires extra waste collection, packaging disposal, or security measures (like a lockable cabinet for stock), these may be claimable.

A key practical tip is to document the space usage. Photos of the workspace and a simple written note of how often it is used can help support your claim if you ever need to justify the calculation.

Software, subscriptions, and services used from home

Many home-based businesses rely heavily on software and online services. These costs are not specific to renting, but they are extremely common and usually straightforward to claim when they are business-related.

Examples include:

Accounting software, invoicing tools, scheduling platforms, design software, cloud storage, domain registration, website hosting, email marketing services, video conferencing subscriptions, and industry-specific tools. If you have a bundled subscription that includes personal entertainment (for example, a streaming service), you should not claim it unless it is genuinely a business cost (such as using media subscriptions for professional review work). Where personal benefit exists, apportion appropriately.

Professional fees and compliance costs

Working from a rented property does not change the fact that professional fees are often claimable. If you pay an accountant, bookkeeper, solicitor, or business consultant, those fees are generally business expenses. The same applies to bank charges for a business account, payment processor fees, and costs of preparing contracts, terms, and compliance documents.

If you pay for a PO box or a virtual office address to avoid using your rented home address publicly, that is typically a business cost. In fact, it is often a practical decision for privacy and professionalism. Similarly, if you pay for registered office services (where applicable), those costs generally arise because of the business and can be claimable.

Marketing and advertising run from home

Marketing costs are usually business-only and claimable regardless of where you work. Common examples include website development, branding, logo design, business cards, flyers, social media advertising, listing fees on online marketplaces, and product photography. If you set up a small photography corner in your rented property (lights, backdrops), those items may be business equipment. If you use part of your home as a content studio, that may support a modest “use of home” claim, but be careful to separate business equipment from personal décor.

Training, books, and education used in a home workspace

Many businesses invest in training and professional development. In general, costs that maintain or improve skills for your current business can be claimable. If you buy professional books, pay for courses, attend webinars, or subscribe to industry journals, these may qualify as business expenses if they are relevant to the trade.

If you take a course that is more about entering a new field rather than improving your existing business skills, it may be treated differently. Practically, you should keep course outlines, invoices, and a note about how the training relates to your current work.

How to calculate “use of home” expenses: three practical methods

When you run your business from a rented property, the biggest challenge is usually apportionment. Here are three common approaches people use.

Method 1: Simplified flat-rate approach

Some tax systems allow a simplified method that uses a flat rate based on hours worked from home or similar criteria. This approach can reduce paperwork because you don’t need to apportion rent, utilities, and council tax individually. If you qualify and the flat rate is acceptable for your business, it can be a convenient option—especially for smaller claims.

The downside is that simplified rates may not capture the true costs for people with high rent, larger workspaces, or high utility usage. But the simplicity and reduced risk of calculation errors can make it attractive.

Method 2: Room-based apportionment

This method uses the physical space of the property. You count rooms or measure floor area. Counting rooms is easier, but measuring floor area can be more accurate if rooms vary significantly in size.

Then you allocate a proportion of eligible costs (rent, utilities, council tax) to the business. If the workspace is used exclusively for business, the calculation can be straightforward. If it is mixed-use, you add a time adjustment.

Room-based apportionment tends to be sensible when you have a dedicated office, studio, or stock room.

Method 3: Time-and-usage apportionment

This approach focuses less on space and more on actual usage. It can be useful if you work from the kitchen table, move around the home, or use a shared room. You estimate business hours as a proportion of total household usage time and apply that percentage to certain costs.

Because it relies on estimates, you should keep a consistent record of working patterns, such as a diary or timesheet, to support the split.

Which costs usually belong in a “use of home” calculation?

When people talk about “use of home,” they typically include:

Rent (business share), council tax (business share), electricity, gas/heating, water, and sometimes a proportion of home internet if it’s not separately tracked. Some people include home insurance where it covers business assets. The exact list depends on what you pay and how your tenancy is structured.

Costs that are usually not included in a generic use-of-home split are those that are clearly business-only and can be claimed directly without apportionment (like business software), as well as costs that are clearly personal (like personal groceries).

What about claiming the cost of a room used exclusively for business?

If you use a room exclusively for business—meaning it is not used as a bedroom, living room, or general personal space—your claim can be stronger. Exclusive use can make apportionment simpler because you don’t need a time split for that room. However, exclusive use can sometimes raise other considerations. For example, your landlord might have restrictions on business use, or your insurer might require disclosure if clients visit. In some places, exclusive business use of part of a home can also have implications for property taxation or reliefs. The practical message is: exclusive use can increase the clarity of your claim, but it can also increase the importance of checking tenancy and insurance terms.

Examples of common scenarios and what you might claim

Scenario 1: Remote consultant working from a rented bedroom. You have a desk in a bedroom that is also used personally. You might claim a portion of broadband and phone (based on business use), and a small portion of utilities and rent (room and time apportionment). You would likely claim business subscriptions, professional insurance, and office supplies in full.

Scenario 2: Online retailer using a spare room as a stock room. If the spare room is primarily for stock and packing, you may justify a larger “use of home” claim. You might claim a room-based share of rent and utilities, plus packaging materials, postage, marketplace fees, and inventory management software. If you pay extra for waste disposal or storage equipment, those costs may be claimable.

Scenario 3: Tutor running lessons online from the living room. You may claim a portion of broadband, possibly a portion of rent and utilities if your business use is consistent, and equipment like a webcam, microphone, and lighting. If you use the same laptop personally, you may need to apportion the cost based on business use.

Scenario 4: Therapist or beautician seeing clients at home (where permitted). You may have stronger grounds for claiming a portion of rent and utilities, and you may incur business-specific costs like additional insurance, laundry, cleaning, or consumables. You should also be careful about lease terms, local licensing rules, and insurance disclosures, because client footfall changes the risk profile.

Records and evidence: how to support your claims

Good record-keeping makes claims easier and lowers stress. For a rented property business, the most helpful records include:

Tenancy agreement and bills: Keep copies of your tenancy agreement and the bills for utilities, council tax, and internet. If costs are included in rent, keep documentation of what is included.

Receipts and invoices: Keep receipts for equipment, supplies, subscriptions, and professional services.

Apportionment notes: Write down your method and keep it with your tax records. For example: “I have 4 rooms. I use 1 room as an office 5 days per week, 8 hours per day. I claim 1/4 of rent and utilities x (40 hours / 168 hours) as the time adjustment,” or whatever method reflects your reality. The exact numbers will differ, but the point is to document the logic.

Usage evidence: A simple work diary, calendar, or time-tracking app logs can help demonstrate that you genuinely work from home. Photos of the workspace can also be helpful, especially for dedicated work areas.

Common mistakes to avoid when claiming expenses from a rented property

Claiming 100% of rent when you also live there. Unless the property is genuinely used wholly for business and not as your home (which is rare), this is usually not reasonable.

Forgetting to apportion mixed-use costs. Phone, broadband, utilities, and even equipment can have personal use. If there is personal use, apportion.

Using a complicated method you can’t explain. If you can’t describe your calculation clearly, it’s likely too complex. A simpler method applied consistently is often better.

Not checking your tenancy or insurance terms. Tax deductibility does not override lease restrictions. If you breach your lease or invalidate insurance, the financial consequences can far outweigh the tax benefit.

Failing to separate business and personal spending. Even if you’re small, consider using a separate business bank account or at least a separate card for business expenses. It makes your records cleaner and reduces the chance of missing claimable costs.

Special considerations: working with a landlord, lease terms, and permissions

Even if you never have clients visit and your business is quiet, it’s wise to understand how your tenancy agreement treats business use. Many leases prohibit running a business from the property, but in practice they often mean running a business that changes the character of the premises—like retail activity, high footfall, noisy operations, or storing hazardous materials. Remote office work is often tolerated, but you should read the wording carefully.

If you intend to:

Have customers visit, employ staff on-site, install signage, store significant stock, or use equipment that could disturb neighbors, you should seek explicit permission. Doing this upfront can prevent disputes and may also be relevant for insurance and local regulations.

Choosing the right approach for your situation

There isn’t one perfect list of expenses because businesses differ. A writer with a laptop has a different cost profile from a craft seller with stock and packaging, and both differ from someone running a therapy practice. The best approach is to categorize costs into:

Direct business costs: Costs you would not incur without the business (software, professional fees, business insurance, advertising).

Use of home costs: Household costs that have a business element (rent, utilities, council tax, broadband).

Capital or higher-value purchases: Larger assets and equipment that may need different treatment or apportionment.

Once you’ve categorized them, pick an apportionment method that suits your reality and stick to it. If your circumstances change—like moving to a larger rented home, creating a dedicated office, or changing working hours—update your calculation accordingly.

Practical checklist of expenses you may be able to claim

To help you review your own spending, here is a practical checklist of common claimable expenses for a business run from a rented property. Not every item will apply, and some may require apportionment.

Use of home (apportioned): rent (business share), council tax/local property taxes (business share), electricity (business share), gas/heating (business share), water (business share), home broadband (business share), and in some cases a business share of contents insurance where it covers business equipment.

Communications: business phone line, business mobile contract, call charges attributable to business, internet services used for business, postage, courier services, and shipping supplies.

Office and admin: stationery, printer ink, paper, bookkeeping software, cloud storage, email hosting, domain names, website hosting, and payment processing fees.

Equipment: computer/laptop, monitor, printer, camera, microphone, lighting, specialist tools, office furniture, filing/storage equipment, and security items (such as lockable cabinets) used for business.

Professional services: accountant, bookkeeper, solicitor, business coach, consultants, and relevant memberships or subscriptions.

Marketing: advertising, business cards, flyers, branding, photography, listing fees, and promotional materials.

Insurance and compliance: professional indemnity, public liability, cyber insurance, licenses, permits, and compliance costs that arise because of the business.

Travel and training (where applicable): business mileage, public transport for business trips, accommodation for business travel, and training that relates to your current business activities.

Final thoughts: claim confidently, but keep it sensible

If you run your business from a rented property, you can often claim a meaningful set of expenses—especially when you account for the business share of rent and household running costs. The safest and most sustainable approach is to be consistent, reasonable, and well-documented. Claim what you genuinely use for business, apportion mixed-use costs in a defensible way, and keep simple records that show how you arrived at your numbers.

If your situation is unusual—such as seeing clients at home, storing substantial stock, or making significant alterations—it can be worth getting professional advice. But for many home-based businesses, a straightforward method and good records are enough to claim the expenses you’re entitled to while staying on the right side of both tax rules and your tenancy agreement.