Upgrade from Residential to Business Broadband

Upgrade from Residential to Business Broadband

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My client is upgrading his broadband from the residential to the business offering, because of the demands of his (home-based) business. He has hitherto apportioned the cost 50:50 between business and non-business use. The business broadband costs twice as much as the residential broadband. My client wants to know if he can apportion the new cost in the ratio of 75:25, which will have the effect of charging all the increased cost to his business. My initial reaction was that this was reasonable, but HMRC at BIM47820 - Specific deductions: use of home: specific expenses states that the applicable proportion should be based on usage.:

My question is: given that he is only upgrading for business reasons, is it allowable to charge the whole increase to the business, or must he follow the letter of HMRC's guidance?

Thanks in advance

Replies (3)

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By petersaxton
02nd Mar 2013 18:40

50%?

If the usage was 50% before wouldn't it still be 50%?

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By Euan MacLennan
03rd Mar 2013 10:00

Of course, it would

I agree with Peter.  If the business usage is 50%, the client can claim no more than 50% of the doubled broadband cost.

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By sebo
03rd Mar 2013 13:03

That's What I Thought

In my draft reply I recommended that he record his usage for a representative period after the business broadband was installed, but I just thought I need to be able to assure him that there is no possibility of his proposed approach being accepted

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