Tax relief on personally owned equipment

If you have a personally owned asset which you sometimes use for business, are you entitled to a tax deduction?



HMRC has a “wholly, exclusively, and necessarily” rule, which means you can’t get tax relief for expenses if there is any non-business use.

However, this rule doesn’t apply in the same way to capital expenses, i.e. the cost of equipment.


The rule for capital expenses doesn’t have wholly or exclusively.

This means that as long as it is necessary for the business, then you can claim some tax relief.


Some tax inspectors say that the “necessarily” condition is only met if the person who bought the equipment was explicitly instructed to do so by their employer.

However, this interpretation is wrong.

The “necessarily” condition actually relates to the type of work, and not the instructions to make the purchase.


If your job requires certain equipment, then that equipment is necessary.

For example, Fred works in IT. His job is to make sure that a website used in the health sector is working.

If the website stops working, then people with illnesses might not be able to get the help they need. This means Fred is on call 24 hours a day.

As he is on call 24 hours a day he will need a computer at home, and something to sit on whilst working.

If Fred uses these 75% of the time for business use, then he claim 75% of the cost as a tax deduction.


Some inspectors argue that you only need to use personal equipment if it is a requirement to work away from home.

This can be overcome by making this the business’s policy:

If a job role means working from home, and the company doesn’t provide the equipment, then the individual must pay for it.