Employee's use of home - Readers' responses to recent items in Taxation.

Taxation 22 March 2001 included an article by Mike Down and Mike Thexton at pages 593 to 596 concerning the ability of a director to deduct the costs of working from home under section 198 Taxes Act 1988 ('Hot Desking in the Library'). The authors state:

'Beware a possible capital gains tax pitfall. If one room in a private house is specifically set aside for business use upon sale the Revenue will want to see a restriction in the private residence relief.'

I assume that in that comment the authors are referring to section 224(1) Taxation of Chargeable Gains Act 1992 which provides:

'If the gain accrues from the disposal of a dwelling-house or part of a dwelling-house part of which is used exclusively for the purpose of a trade or business or of a profession or vocation ...