Originally Posted by jayeff

I have to go along with those who pointed out that claiming expenses for a home office raises red flags and other issues. The potential saving is rarely worth the potential hassles of audits and additional accounting when you move.

I started working life as an accountant. Although that was many years ago, one piece of advice which still holds good is never to try to gouge the tax man. You hear/read about lots of people who have done this or that and "got away with it" for years. That isn't surprising since unless you set alarm bells ringing, most years your returns are signed off on with barely a look. But your turn will come and with penalties and interest, allowances you never should have claimed will come back and bite you in a big way.

If you are making any kind of money, unless you really know what you are doing, hiring a good accountant - not one of the Main Street book-keeping shops - is an excellent investment. In fact, if you plan on making money, finding a good accountant should be a priority right up there with buying a computer, software, content, etc. Don't wait until it's time to do your returns.

Apart from the tax angle and maximising legitimate tax avoidance, properly kept accounts are a good tool for your business; vital if you ever want to sell part or all of it; and make it much easier to get credit, mortgages, etc.