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Landscaping and Home Improvements: Home-Based Tax Write-Off

business use of home income tax savings tax write offs Jul 17, 2022
tax write-off, tax secrets, home business, home-based business taxes, home improvments

As a home-based business, the cost of sprucing up your home can qualify as a tax write-off as long as you can prove the improvements are tied to (or somehow related to) your business.

For example, if you often meet with clients at your home, then making your home more appealing is related. This could also include the tools and materials used in landscaping and home improvement, or the cost to hire contractors.

The tax write-off would only be prorated down to the percentage of space your home office occupies, and the improvements are claimed under Business Use of Home expenses.

However, any improvements or renovations you make to your home office is a 100% tax write-off as an office expense. You must ensure you meet the government qualifications of the dedicated space for home office though.

In determining whether the office in your home qualifies as your principal place of business, you must consider the following two items:

  • The relative importance of the activities performed at this place where you conduct business.
  • The amount of time spent at this place where you conduct business.

Your home office will qualify as your principal place of business if you meet the following requirements.

  • You use it exclusively and regularly for administrative or management activities of your trade or business.
  • You have no other fixed location where you conduct substantial administrative or management activities of your trade or business.

Administrative or management activities

There are many activities that are administrative or managerial in nature. The following are a few examples.

  1. Billing customers, clients, or patients.
  2. Keeping books and records.
  3. Ordering supplies.
  4. Setting up appointments.
  5. Forwarding orders or writing reports

Following these guidelines, almost any type of "business activity" can be classified as a home-based business for tax purposes...!!

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