As a home based business, you must account for all your business expenses.  The key word here is Business Expense.



A business expense must be both ordinary and necessary for the effect running of any business.  Ordinary expenses will be common and acceptable expense in your field of business.  For example: An ordinary expense for a catering business will be flour to bake cakes or cookies.  Flour will not be an ordinary expense for a photography business but CDs or photobooks will be.


Business Expenses may include, but are not limited to, the under mentioned:

  • Business Promotions and Advertisements
  • Bank charges and interest
  • Charitable Donations
  • Depreciation
  • Directors’ Remuneration
  • Entertainment (75% of expenses, incurred)
  • General Expenses
  • Insurances – public liability, workmen’s compensation, health insurance and home insurance (if home based business)
  • Motor Vehicle Expenses- Gas, repairs and insurance
  • Penalties and interest
  • Professional Fees – Accounting, auditing and legal
  • Repairs & Maintenance Building and computers
  • Office Expenses: Stationery, printing, staff groceries, etc.
  • Salaries: Gross salary, bonuses, commission, 2/3 employers’ contribution (budget 13 months of salary per employee to cover relief staff for vacations and sick leave should the need arise).
  • Utilities: electricity, internet, water rates, cellular phone, cable (if you have a restaurant or a waiting room for your guest)


Here are two options on how to record your business expenses as a home based business:

Option 1:

  • Calculate the dimensions of your home office or working space as a percentage of your home.
  • This fraction will be used to calculate the exact value of your expense as home which is used by your business:
    • Telephone
    • Electricity
    • Internet
    • Water Rates

For example:  Your workspace is 10 feet by 12 feet = 120sq ft; your house’s living space is 2,500 sq ft.  Your work space is 4.8% of your entire floor space.  Hence, you will do as follows:

  • T&TEC bill for February to March $530.50.
  • Your business’ usage will be (4.8% * $530.50) = $25.47

The same will be done for each expense above.


Option 2:

  • Apply 25% of the listed expenses as the operating expenses of the business.

For example:

  • T&TEC bill for February to March $530.50.
  • Your business’ usage is calculated as ($530.50*.25) = $132.63


Be sure to join our Facebook, Instagram, Tiktok and our Website for more valuable information.  Ask about our Business Startup Kit, Retainer Package,  Year End Retainer Package , Business Bank Account or learn how manage your finance with our Prerecorded and Live Courses.  Book a FREE 15 mins CONSULTATION on Fridays from 1pm to 3 pm.

“A wealthy person is simply someone who has learned how to make money when they’re not working.” – Robert Kiyosaki