If the impact of the coronavirus pandemic has made you buy new equipment for, or create a new at-home office, then HM Revenue & Customs (HMRC) may view this as a space that is solely for business purposes. If so, then they could land you with an unexpected tax bill.
Under HMRC rules, if any part of your main home is used only for “trade, business, profession or vocation,” then you will be subject to Capital Gains Tax (CGT) on the sale of the property. 
Employees who have built either a shed or another structure in their back garden for a home office could be at a particular risk of being questioned by tax inspectors.
Calculating CGT
The amount of CGT you would be subject to when you dispose of your residency, that has a home office, is calculated on the period of your occupancy, the period in which you used the office, and what percentage of the home office makes up the house. 
Therefore, if you want to divert this tax, then you should consider refraining from using your office for the sole purpose of work. 
Turning your office into a multi-purpose room
Ways you can show that the room is multi-purposed is through allowing leisure activities to take place in there and adding a TV or other objects to make it clear that the room is for non-businesses purposes too.
However, if you want your newly converted office to be used for business purposes only, then being honest about this is essential and you should expect to be taxed. 
Private Residence Relief
What’s more, if no part of your home has been used exclusively for business purposes during your period of ownership, then you could get a Private Residence Relief which means you will not have to pay CGT on the disposal of your home.
For more information on matters relating to the tax implications of home offices, contact our expert team today.