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enquiry-cleric-a
Level 1

Entitled to claim use of home office of £312, when allocated to expense account it is later disallowed for calculation of net profit

 
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Best answer October 26, 2021

Accepted Solutions
ChristieAnn
QuickBooks Team

Entitled to claim use of home office of £312, when allocated to expense account it is later disallowed for calculation of net profit

Hi there, enquiry-cleric-a.

 

Thank you for visiting the QuickBooks Community. I'll ensure to share some details on how the expense category works in QuickBooks Online. Then, route you to the right person to assist you further with this matter.

 

When you categorise entries, QuickBooks puts your transactions in the correct line category. That said, allowable expenses are costs that are necessary to running your business. Then, can be deducted from your taxable income to reduce your Income Tax liability. Allowable expenses do not add money taken from your business to pay for personal purchases. If an entry is not “wholly and exclusively” used for business purposes, it is Disallowable and you can not claim it as a deduction to reduce your taxable income. For further details, you can click on this article: Allowable and Disallowable Expenses. This also provides details about the type of expenses you can deduct and those you can't. 

 

Additionally, there is also a category called Simplified expenses to calculate the deduction for work from home set up for more than 25 hours a month. To see additional information, you may open this article: Simplified Expenses

 

I recommend consulting an accountant for additional assistance to ensure your records are in shipshape. They can offer advice on how to handle the transaction or the home office of £312.

 

Lastly, you can click this article so you're able to view steps on how you can record make any changes to your expenses in QuickBooks Online: Enter and manage expenses in QuickBooks Online.

 

Let me know in the comment section below if you have any other questions about managing your expenses transaction. I'm always here to help. Have a great day ahead.

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1 REPLY 1
ChristieAnn
QuickBooks Team

Entitled to claim use of home office of £312, when allocated to expense account it is later disallowed for calculation of net profit

Hi there, enquiry-cleric-a.

 

Thank you for visiting the QuickBooks Community. I'll ensure to share some details on how the expense category works in QuickBooks Online. Then, route you to the right person to assist you further with this matter.

 

When you categorise entries, QuickBooks puts your transactions in the correct line category. That said, allowable expenses are costs that are necessary to running your business. Then, can be deducted from your taxable income to reduce your Income Tax liability. Allowable expenses do not add money taken from your business to pay for personal purchases. If an entry is not “wholly and exclusively” used for business purposes, it is Disallowable and you can not claim it as a deduction to reduce your taxable income. For further details, you can click on this article: Allowable and Disallowable Expenses. This also provides details about the type of expenses you can deduct and those you can't. 

 

Additionally, there is also a category called Simplified expenses to calculate the deduction for work from home set up for more than 25 hours a month. To see additional information, you may open this article: Simplified Expenses

 

I recommend consulting an accountant for additional assistance to ensure your records are in shipshape. They can offer advice on how to handle the transaction or the home office of £312.

 

Lastly, you can click this article so you're able to view steps on how you can record make any changes to your expenses in QuickBooks Online: Enter and manage expenses in QuickBooks Online.

 

Let me know in the comment section below if you have any other questions about managing your expenses transaction. I'm always here to help. Have a great day ahead.

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