Is home and landlord insurance
tax deductible?

Partly for sole traders, and yes for landlords. Landlords can deduct insurance such as buildings, contents and public liability policies for a let property (GOV.UK). A sole trader working from home can include a share of home insurance in an actual-cost claim, as HMRC's own examples do (BIM47825), and insurance for business premises is allowable in full (GOV.UK).

Insurance follows the property. For a landlord, a landlord policy on a let property is a straightforward allowable cost. For a trader with premises, property insurance is a premises cost. For someone working from home, the household policy is mainly personal, but a share can be included when you work out the actual costs of the business use of your home.

Is home and landlord insurance tax deductible?

The HMRC rule

Landlords can deduct costs wholly and exclusively for the letting: repairs, water rates, council tax, gas and electricity, insurance, letting agent and management fees, ground rents, service charges and accountancy. The rule comes from Work out your rental income when you let property, If you work from home, Office, property and equipment.

GOV.UK lists insurance, such as landlords' policies for buildings, contents and public liability, among the expenses a landlord can deduct (landlords). For sole traders, property insurance is one of the allowable premises costs (office, property and equipment), and HMRC's worked examples of working from home include insurance in the fixed costs apportioned by area and time (BIM47825). Insurance on the part of a property not used for the business is disallowable (SA103F notes).

When you can claim it

• Landlord buildings and contents insurance for a let property.
• Landlord public liability insurance.
• Buildings and contents insurance for business premises.
• A share of home insurance for a home office, when claiming actual costs.

When you cannot

• Home insurance on your own home when you do not work from it.
• The private share of home insurance when you do.
• Life, health or income protection policies, which are personal.
• Insurance for a property you have bought but not yet made available to let, in some cases.

What to claim instead

If you only use the working-from-home flat rate, it does not include insurance; to include a share of home insurance, work out actual costs. Business equipment kept at home can be insured on a separate business policy, which is allowable in full.

How to decide if you can claim it

1. Was it for the business? A cost is only allowable if you incur it wholly and exclusively for the business. If it also serves a personal purpose that cannot be separated, such as clothing that keeps you warm or a meal that keeps you going, HMRC disallows it.
2. Is part of it personal? Where a cost has a business part you can identify, such as the business calls on a phone bill or the business miles in a car, you claim that part and leave the rest out, on a reasonable basis you can explain.
3. Is it a running cost or something you keep? It is a running cost, so on the cash basis it counts when you pay it and on traditional accounting when you incur it. Nothing about it needs spreading over later years.
4. Is there a specific rule? For home and landlord insurance, the deciding rule is running costs of a let property: landlords can deduct costs wholly and exclusively for the letting: repairs, water rates, council tax, gas and electricity, insurance, letting agent and management fees, ground rents, service charges and accountancy.

Worked example: HMRC’s architect, Gordon

HMRC's example: Gordon uses one room as an office. After apportioning by rooms, the room's fixed costs (Council Tax, mortgage interest, insurance) are £600, and by time he claims 8/10 of them, £480, plus 4/6 of £300 of variable costs, £200: £680 in total. Insurance is simply one of the fixed costs in that calculation.

Landlord policies

Standard home insurance usually excludes letting, so landlords need a landlord policy. The premium is an allowable expense of the letting business, in box 24 of the UK property pages. Policies often bundle buildings, contents, public liability, legal expenses and rent guarantee cover; the parts that protect the letting business are allowable. If an insurer pays for a repair, you can only claim the repair costs the pay-out did not cover.

Business premises

A trader with a shop, unit or office claims its buildings and contents insurance as a premises cost, in rent, rates, power and insurance costs, box 21. Public liability, employer's liability and professional indemnity insurance are separate business insurances, allowable in full, and go in their own categories.

Business equipment at home

Household policies often limit or exclude business equipment. If you work from home with valuable tools, stock or computers, a separate business contents or equipment policy is worth considering. Its premium is fully allowable, because it covers only business assets, and it is not part of the working-from-home apportionment.

Insurance pay-outs

When an insurer pays out for damage to business premises or a let property, the pay-out is set against the cost of the repair, and you claim only the part you paid yourself. For a landlord, the same applies to a tenancy deposit you keep to cover damage: you can only claim repair costs beyond the amount of the deposit you kept.

Where it goes

Landlords put insurance in box 24 of the UK property pages, rent, rates, insurance and ground rents. Sole traders put premises insurance in box 21, and a home-office share of home insurance as part of the use-of-home figure in the same box.

If you are a landlord

Landlords can deduct buildings, contents and public liability insurance for let properties (GOV.UK). For jointly owned lets, each owner claims their share of the premium along with their share of the income.

Where it goes on your return and in MTD

On the self-employment pages of your return, the claimable part of home and landlord insurance belongs in rent, rates, power and insurance costs (SA103F box 21). The same category is used in Making Tax Digital quarterly updates, so recording it in the right place once keeps both returns consistent.

For a landlord, it belongs in rent, rates, insurance and ground rents (property) (SA105 box 24 on the UK property pages), and in the matching category of a Making Tax Digital property update.

If your turnover was under £90,000, you can use the short self-employment pages (SA103S), which ask for a single figure for total allowable expenses rather than a box-by-box breakdown, and the full pages let you give just a total in box 31 too. The category still matters for your own records and for Making Tax Digital, where each quarterly update uses the same categories unless you choose to send one consolidated figure.

The accounting basis changes when a cost counts. On the cash basis, the default for sole traders since 2024/25, it counts when you pay it; on traditional accounting, when you incur it, with things you keep claimed through capital allowances.

How much an allowable cost saves

An allowable expense does not come back to you in full: it reduces your profit, so it saves tax at your marginal rate. For a sole trader in England, Wales or Northern Ireland that is 26p in the pound at the basic rate (20% Income Tax plus 6% Class 4 National Insurance) and 42p at the higher rate. The sole trader tax calculator works out the figure for your own profit.

What £1,000 of allowable expense saves a sole trader in 2026/27

• Basic rate (20% + 6%)£260
• Higher rate (40% + 2%)£420
• Additional rate (45% + 2%)£470
• Allowance taper band (60% + 2%)£620

Records to keep

Keep mortgage statements showing the interest and capital split, insurance schedules, service charge demands and invoices, and completion statements for any purchase. For a home also used for business, keep the calculation of the business share. Records must be kept for at least five years after the 31 January deadline for the tax year.

If Making Tax Digital for Income Tax applies to you (qualifying income over £50,000 from April 2026, £30,000 from April 2027 and £20,000 from April 2028), the records must be digital, and each quarter's costs go into a quarterly update. Check your date with the MTD requirement checker.

Common mistakes

• Claiming a full home insurance premium for a small home office.
• Letting a property on a standard home policy that excludes letting.
• Claiming repair costs the insurer has paid for.

Related expenses

This item sits in the rent, rates, power and insurance costs category, alongside business rates, council Tax, garden office, mortgage interest, rent, service charges, solar panels and stamp Duty. The A to Z of expenses answers the same question for every other cost.

If you record your costs in TapTax, each one lands in the HMRC category it belongs to, with its receipt attached, so your quarterly updates and year-end return use the same figures.