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01 February 2017

Can I claim tax relief for a garden office?

With many small businesses run from home, we are regularly contacted by clients that are considering building an office in their garden, to find out what tax relief can be claimed.

Unfortunately an outbuilding will be classed as a structure and it is not usually possible to claim tax relief for the costs of the building itself, even if it is moveable. This also applies to the costs of any planning or installation.

However, it should be possible to claim tax relief for any furniture or equipment installed into the building (eg. curtains, desks, shelving) as, unlike the building itself, capital allowances can be claimed. In most cases you will obtain tax relief for these items in full in the year of purchase.

In addition, it will be possible to claim a capital allowance for the cost of any thermal insulation, even where it forms part of the structure. The same is often also true for certain wiring and plumbing costs.

Furthermore, tax relief can be claimed on the costs of running the garden office, such as lighting and heating, repairs and general upkeep.

What about VAT? There is some good news, as any VAT incurred on the cost of the structure itself or any furnishings or furniture can be reclaimed. VAT can also be reclaimed on the ongoing running costs.

For further advice, please contact me.

Key Facts:

  1. Tax relief cannot usually be claimed on the cost of a garden office building
  2. However, tax relief can be claimed on furnishings and equipment used in the building
  3. Capital allowances can also be claimed on thermal insulation and some wiring/plumbing
  4. Tax relief can be claimed on running costs, such as heating, lighting and repairs
  5. VAT can be reclaimed on the costs of the building itself and the ongoing running costs

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The Mill, Pury Hill Business Park
Alderton Road, Towcester
Northants, NN12 7LS

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