Here are some more tax-easing tips for people who have decided to work from home or form their own home-based businesses. Business solutions experts swear by the effectiveness and relevance of these tips:

1. Ensure the accuracy of your record keeping and book keeping. In order to help individuals about this, the HM Revenue & Customs (HMRC) has issued a user-friendly booklet that advises which records the office would likely ask from self-employed individuals. Basically, records should be kept of all income, all expenses and to have backing documentation for these.

2. Not all expenses can be used to lower the tax bill. It is a common misconception that all expenses can be claimed for tax purposes. The reality is, only expenses that have been used wholly and exclusively for the purpose of the business can be applied for tax relief.

3. Think carefully and study whether to use a room in the home for solely business purposes. A dedicated room will enable you to properly apportion all of your household expenses (lighting, heating, mortgage) and claim a proportion. But then doing this may also mean losing a part of the capital gains tax exemption when the property is sold. Weigh the pros and cons before deciding what to do.

4. Factor in the risk that will be involved in the business as this will help you in determining whether you want to set up the business as a sole owner, enter into a partnership or form a company.

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