• Last Updated:
  • Oct 11th, 2017 7:34 pm
Sr. Member
Jan 2, 2013
880 posts

Home-business Tax question

Sorry for being a keener about tax, but here's a math exercise:

I started my home-office business (which I only run part-time) on 1st Aug, this year.

So, 152 days out of 365 this year if I count from Aug 1st. But I only work every other day, and even then only 4 hours a day.
How do I find and calculate my correct ratio for write-offs?

Example : Property tax 2500$.
1. 2500 divided by 365, multiplied by 152 days the business was registered = $1041.
2. Half the days worked = $520.5
3. 4 hours per 24 hours (16.6667%) = $86
4. 7% square footage business usage compared to my place = 6$ as my actual write off.

Is that correct?
2 replies
Jul 19, 2010
9 posts
When you are not conducting business, is the 7% square footage available for personal use? If not (due to conversion, space lost due to storage, etc), then items 2 and 3 could be adjusted.

Otherwise, this is a very honest calculation. Don't forget about other costs like utilities, mortgage interest, etc.
Dec 7, 2016
48 posts
I have a small biz and I use 1/3 of my house and 1/2 of my husband's shop for it. For years I have done the math to calculate 1/3 of the house expenses that are allowable like taxes, hydro, water, heat, insurance, repairs and 1/2 of shop expenses. My accountant has always been alright with that method.