I am a sole trader running a small pottery business from my home. The cost of firing the electric kiln is significant and is not reflected by the ‘expenses incurred by working in the home’ calculation. I can make a reasonable estimate of the costs by comparing electricity consumption on the days the kiln is fired with days it is not fired. Can I use this estimate to calculate allowable expenses? If not, how do other sole traders approach business-specific expense calculations? 

Arthur replies: 

Yes, you can do as you have written. It is logical and makes sense. You need to use the same method consistently. The more record-keeping and the more documentary evidence you have, the better. As long as your expenses are 'wholly and exclusively' for the business, they should beallowable. The method that you have outlined potentially isolates the business expenses. See the end of HMRC’s Business Income Manual at BIM37007.