History- client started a highly successful retail business 6 years ago- showroom and small office in commercial premises purchased outright. Soon realised that the stock levels and paperwork had filled every square inch of the office area forcing bookkeeping etc. to be undertaken from his home, being a modest 3-bed semi but no garage. Loft now full. Some stock has to be stored at the home. Recently his daughter left (moved overseas with partner) and her old bedroom now shelved out and rapidly filling up with lever arch binders (very paper-intensive business).
Due to time factor client reluctant to scan 200-ish bulging lever arch binders full of confidential paperwork and long-suffering wife and co-Director unhappy about a storage building in modest garden.
With care client can now start to dispense with earlier items by secure shredding so the influx may gradually slow down. House removal totally out of the question and "secure storage" currently unsuitable due to excessive cost and inconvenience, the family is stuck with all this paper, but coping (just). Business premises or home relocation removal out of the question. Client reluctant to build an extension to the home.
Question:- in these genuine circumstances of excess home use, plus the need to deal with bookkeeping etc. can the company pay the director a rent (can be valued professionally) and the director claim Lettings Allowance to offset as detailed expenses calcs for HMRC would be a very long and involved job- the paperwork is still flowing in greater than ebbing out.
Trust this matter is quite relevant to many clients, even though this case does involve excess paper in this particular business.
Thanks all in advance!