Free tool · 2026/27

Use of home as office calculator for limited company directors

Quick answer: Your company can pay you £6 a week (£26 a month if paid monthly) tax-free for the extra household costs of working from home under an agreed arrangement, with no receipts needed. Over 52 weeks that is £312, deductible for the company: £59.28 of Corporation Tax at 19%. Paying more needs evidence of the extra costs. The alternative, renting a room to the company, gives a bigger deduction but is taxed as your property income and can affect Capital Gains Tax relief on your home.

Written and reviewed by James Whitfield · Last checked against GOV.UK, HMRC and legislation.gov.uk · Editorial standards · Methodology. Estimates for planning only, not tax advice.

Use the calculator

Use of home as office calculator

Enter your figures and press Calculate. The result shows below the form.

Tax year 2026/27
£
Rent method only
£

Heating, power, insurance, broadband, council tax and similar running costs. Leave out mortgage interest, which has its own rules for residential property.

Leave out kitchens and bathrooms if you prefer; be consistent.

£

Anything above cost is taxable profit for you.

£
£
Company deduction
£312
Corporation Tax saved
£59.28
Taxable for you
£0
£6 × 52 weeks, paid to you free of tax and NI£312
Corporation Tax saved at £40,000 profit£59.28

Needs an arrangement with your company under which you regularly work at home. Monthly payments: £26 a month. Paying more is tax-free only with evidence of the extra household costs.

About this calculator

What this tool covers

Since 6 April 2026 employees cannot claim tax relief for working from home themselves, so for a company director the company paying you is the route that is left. This calculator compares the two ways it can do that: the £6-a-week homeworking payment, and a rent or licence for a room that the company uses.

It shows the deduction the company gets, the Corporation Tax that saves at your company's profit level, and any taxable income the rent creates for you. Our expenses guides cover the full list of costs a company can pay; this page is just the home office.

Read alongside: Limited company expenses guide · Company expenses guide.

How this is worked out

How the two methods are worked out

  1. Flat rate: £6 × the weeks you work from home under the arrangement. A director is an office-holder, and office-holders count as employees for the homeworking exemption, so the payment is free of tax for you.129
  2. The exemption needs arrangements with the company under which you regularly work at home; occasionally taking work home does not count. Above £6 a week you need evidence of the additional costs, such as heating and lighting the work area, extra metered water, business calls or extra insurance.23
  3. Rent method: the company pays rent for a room it uses. The calculator takes your household running costs × the share of rooms used × the business-use percentage, plus any extra rent you enter. The rent is the company's deduction.
  4. The rent is your property income. Your matching share of the costs comes off it, so a rent set at cost leaves no taxable profit. You cannot use the £1,000 property allowance against income from a company you control.7
  5. Corporation Tax saved = tax on profit before the payment less tax after it, so it reflects 19%, 25% or the marginal relief band exactly.8
Worked examples

The flat rate for 46 working weeks

A director who works from home under an agreed arrangement for 46 weeks of the year.

Payment: 46 × £6£276
Tax and NI on it for the directorNone
Corporation Tax saved at £40,000 profit£52.44
At £120,000 profit (marginal relief band)£73.14

Small, but it needs no receipts and no paperwork beyond the arrangement itself. The saving is the company's; the payment reaches you free of tax.12

Rent for one room out of six

£6,000 a year of household running costs (heating, power, insurance, broadband and the like), one room of six used only for work.

Cost share: £6,000 × 1/6£1,000
Rent the company pays£1,000
Taxable profit for you (rent less the same costs)£0
Corporation Tax saved£190

Setting the rent at the cost share leaves you no taxable profit, but the room is now used exclusively for business. That is what can cost Private Residence Relief on that part when you sell, and may bring business rates.56

Every figure in these examples is calculated by the same code as the calculator above, using the 2026/27 rates.

Mistakes and edge cases

What HMRC does and does not allow

Costs that do not change
The £6 exemption is for additional household costs. Mortgage interest, rent, council tax and water rates are the same whether or not you work at home, so they cannot be reimbursed under it.
Choosing to work at home with no arrangement
The exemption applies where you work at home by arrangement with the company, regularly. Taking work home in the evenings is not enough.
Exclusive business use
Using a room only for business can lose Private Residence Relief on that part of the home when you sell. A room used as a temporary or occasional office does not count as exclusive use.
Business rates
Part of a home used for business can be given a rateable value, with business rates to pay on it. The Valuation Office Agency decides.
Claiming the £6 yourself
From 6 April 2026 you cannot claim working-from-home relief from HMRC on your own; the payment has to come from the company.
Equipment is a separate question
A laptop or desk the company buys for your work is a company asset, not part of the £6. If private use is insignificant there is no benefit in kind.
Common questions

Use of home as office calculator: FAQs

Can my limited company pay me for working from home?
Yes. It can pay £6 a week, or £26 a month, tax-free without you showing the costs, where you regularly work at home under an arrangement with the company. More is tax-free only with evidence of the extra costs.
Does the £6 a week apply to company directors?
Yes. Directors are office-holders, and for these rules office-holders are treated as employees, so the homeworking exemption applies in the same way.
Can I still claim working from home relief from HMRC?
Not for 2026/27 onwards. From 6 April 2026 employees cannot claim the relief themselves; claims for the four previous tax years are still possible.
Should I charge my company rent for my home office?
It gives a bigger company deduction, but the rent is your property income, you cannot use the £1,000 property allowance on it, and exclusive business use can cost Private Residence Relief when you sell.
How much Corporation Tax does the £6 a week save?
£312 a year saves £59.28 at 19%, £78 at 25%, and £82.68 in the marginal relief band where each extra pound is taxed at 26.5%.
Can the company pay my broadband?
If you did not have broadband before, need it to work from home and use it mainly for business, the company can reimburse it without tax. An existing connection is a household cost.
Sources & references

Where these figures come from

The rates and rules on this page are drawn from the official UK government sources below, using the confirmed 2026/27 figures. Each link opens the relevant HMRC, GOV.UK or Companies House page in a new tab.

  1. Expenses and benefits: homeworking www.gov.uk/expenses-and-benefits-homeworking
  2. Income Tax (Earnings and Pensions) Act 2003, section 316A: homeworker's additional household expenses www.legislation.gov.uk/ukpga/2003/1/section/316A
  3. HMRC EIM01474: household expenses, what costs can be reimbursed www.gov.uk/hmrc-internal-manuals/employment-income-manual/eim01474
  4. Claim tax relief for your job expenses: working from home www.gov.uk/tax-relief-for-employees/working-at-home
  5. Running a business from home (business rates and Capital Gains Tax) www.gov.uk/run-business-from-home
  6. Tax when you sell your home: Private Residence Relief www.gov.uk/tax-sell-home
  7. Tax-free allowances on property and trading income www.gov.uk/guidance/tax-free-allowances-on-property-and-trading-income
  8. Corporation Tax rates and reliefs www.gov.uk/corporation-tax-rates
  9. Income Tax (Earnings and Pensions) Act 2003, section 5: offices and office-holders www.legislation.gov.uk/ukpga/2003/1/section/5
Verified against published UK government guidance.

Every rate on this page was checked against these pages on 4 November 2026.

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