Registering an office or home

The office costs budget is provided to meet the costs of renting, equipping and running MPs’ constituency offices, surgeries, and other activities which support their parliamentary functions, where these costs are not covered by other budgets. [6.1]

All MPs are eligible to claim for office costs, whether or not they rent office premises. [6.2]

Rent cannot be claimed for a home office (and note that such an address will be treated as the MP’s home rather than an office, for travel claims). [6.8]

IPSA will pay for rent on an office only after it has been registered and accompanied by the required documentation including the MP's rental agreement. [6.13]

Claims for the following costs will only be allowed if the constituency or home office has been registered with IPSA, and comply with the requirements set out in Office costs you can claim:

• energy and water bills

• business rates (not for home offices)

• contents insurance

• buildings insurance (not for home offices)

• rental and usage costs for telephone and internet access [6.14]

For more information, visit Completing a property registration form .

MPs are entitled to exercise reasonable discretion over claims for items that meet the purposes of the office costs budget, provided that the claims adhere to the fundamental principles and general conditions of the Scheme. [6.4]

They must also observe the conditions set out in Office costs you can claim.

A start-up supplement will be added to the office costs budget of newly elected MPs. It is designed to help new MPs meet the costs of setting up their constituency offices. [6.11]

The start-up supplement is available to new MPs for the duration of the financial year in which they were elected.

If a new MP is elected in the three months before the end of the relevant financial year, IPSA may exercise discretion in rolling forward all or part of the start-up supplement into the office costs budget for the following financial year. [6.12]

MPs can claim for the costs of more than one office provided that they stay within budget.

If you can demonstrate exceptional circumstances, you may be eligible for contingency funding to allow for the operation of more than one office. [6.3]

MPs may claim for the costs of a home office if that is where they routinely work from.

IPSA will only pay claims for costs that are additional to those which are part of the normal cost of living in the home.

Staff members who are home-based may claim homeworking costs that are additional to normal costs of living in the home, or receive the homeworking allowance (under [7.17]), but cannot do both in the same period. [6.6]

To be funded by IPSA, a constituency office must be located in the constituency – unless it is a home office.

A home office can be claimed for even if it is more than 20 miles from the constituency boundary. [6.7]

Rent cannot be claimed for a home office. The location will also be treated as the MP’s home rather than an office for the consideration of any travel claims. [6.8] This is covered by requesting additional budget.

Find out more about applying for contingency funding using IPSA Online.

Removal costs for moving to new office premises may be claimed from the contingency budget. No pre-approval is required.

Other costs associated with moving, including any legal costs, must be claimed from the office costs budget. [6.9]

MPs may claim under office costs for 'routine security measures', i.e. not those which are now funded by the House of Commons as recommended or further security measures. [6.10]

Find out more about security measures and assistance.

When submitting claims for telephone calls, MPs should only claim for that proportion of the costs that has been incurred for parliamentary purposes. [6.29]

MPs may claim for pooled staffing services from either the office costs or staffing budget. [6.30] Find out more about staffing costs and staffing costs you can claim.

IPSA will not pay claims for any of the following:

• alcoholic drinks

• stationery provided by the House of Commons

• newsletters

• funding of any material, other than websites, that contains a party-political logo or emblem, or

• accountancy or tax advice [6.5]

If two or more MPs share rental accommodation, they must notify IPSA when they register the property.

The rental agreement must include the name of each MP sharing the accommodation. [4.22]

Each MP will be entitled to the full accommodation costs budget – and all costs claimed should be shared equally between those MPs. [4.23]

An allowance ("the homeworking allowance") is payable to MPs’ staff members who are home-based, to cover homeworking costs such as telephone, internet, electricity and gas usage.

These amounts will be paid directly to relevant staff members through the payroll, with the costs allocated to the staffing budget. [7.17]

The homeworking allowance amount will be the prevailing amount as set out in HMRC guidance as the maximum that can be paid to employees without evidence of the actual costs incurred.

Payment of this amount will be pro-rated for staff members who start or end their employment during a month. [7.18]

In respect of a staff member in receipt of the homeworking allowance, IPSA will not accept claims (or will seek repayment of claims already paid) (under paragraph 6.6 and paragraph 6.14 for costs which are incurred as a result of homeworking and are additional to those which are part of the normal cost of living in the home, including:

• energy and water bills

• contents insurance, or

• rental and usage costs for telephone and internet access [7.19]

If individual staff members are not working from home, or do not wish to be in receipt of the homeworking allowance, the employing MP must notify IPSA by the normal monthly deadline for payroll changes.

This also applies where staff members who were previously in receipt of the homeworking allowance have returned to their normal place of work (the constituency or Westminster office). [7.20]

The homeworking allowance is only payable to staff members who are on a home-based contract. Allowance costs will be allocated to the staffing budget, rather than the office costs budget, from that date.

For more information visit Homeworking allowance.

Eligibility

A homeworking allowance can be paid monthly to any member of staff who is on a home-based contract.

Those who are on hybrid or office-based contracts are not entitled to the payment.

Value of the homeworking allowance

As of August 2022, the homeworking allowance is £26 per month.

This allowance is set by HMRC and is the maximum that can be paid to staff without evidence of the actual costs incurred.

Opting into the homeworking allowance

Eligible staff will automatically receive the allowance.

The homeworking allowance payment will be added to the payroll as soon as IPSA is notified that the staff member is eligible. This is when a staff member is employed on – or has moved to – a home-based contract.

All homeworking allowance payments are made through payroll.

Opting out of the homeworking allowance

Tax positions can vary across individuals and in some cases, home-based staff may wish to opt out of receiving the homeworking allowance and apply to HMRC for tax relief. In these cases, you should refer to HMRC guidance.

If a staff member is expecting significantly higher costs than the allowance payment, it is possible to opt out of the homeworking allowance payment and claim actual costs. This option is more burdensome, is only payable for certain costs, and will need to be evidenced.

The homeworking allowance is the default option because it is the most straightforward way to cover costs.

If a staff member changes their home-based contract to a hybrid or office-based contract, they will no longer receive the homeworking allowance payment.

Claims outside of the homeworking allowance payment

Only one of the options can be claimed for at any one time – either the homeworking allowance payment, reimbursement of actual costs or tax relief directly from HMRC.

Receiving the homeworking allowance does not require any claim or submission of evidence and therefore we think it is the best option for home-based staff.

Actual costs

If you opt for reimbursement of actual costs, claims are only considered when it can be demonstrated they are in addition to the normal costs of running the home. For example, to claim the cost of fuel or utilities, the staff member must be able to demonstrate the increase in usage as a result of working from home.

You can only claim for costs incurred directly as a result of your work, such as business phone calls or gas and electricity for your work area.

Normal running costs are not claimable. For example, in most cases, staff members will not incur any additional broadband costs as a result of working from home, because they would have a home internet connection anyway.

As claims are on an actual cost basis, they must be calculated for each claim made, rather than determining a regular or average figure.

Utility costs

Claims for utility usage are based on the charges for which evidence is provided to show they are directly related to working from home. The easiest way to provide this is to calculate the difference in usage between working away from the home and working within the home.

This means that bills need to be provided as evidence of usage for a time when a home office space was not used and compared directly to usage when it is being used.

A like-for-like comparison based on cost alone is not sufficient to make a claim as other factors need to be taken into account, such as the standing charge (or equivalent) and a general increase in energy charges.

A further consideration is whether the entire increase in usage can be attributed to the home office and/or whether other home workers are using the space.

Additional costs must not be calculated on a pro-rata basis based on the size or business usage of the home nor should an estimation be used. An increase in the underlying fuel, utility or other costs will not be considered additional homeworking costs.

A description of how the claimed amount has been calculated and supporting evidence must be submitted with the claim.

Because providing evidence in this way could be an onerous task, our suggested route is to opt for the homeworking allowance to be paid as a fixed sum each month.

Cost of phone calls

For business calls, details of the itemised business calls and charges must be provided. An estimation or a pro-rata split of overall costs will not be considered sufficient to support a claim.

Actual costs that cannot be claimed

Claims cannot be made for any amount of rent, mortgage, or standing charges for utilities and broadband or phone line rental as these would form part of the normal costs of running a home.

Claims will not be considered unless evidence is provided to show they are directly incurred as a result of your work – such as business phone calls, or gas and electricity for your work area.

Moving staff members to a home-based contract

Staff members can be moved to a home-based contract if needed, but it is important to bear in mind that home-based contracts are likely to be appropriate only for a minority of staff members who carry out all of their normal duties from home and are rarely expected to attend the office. Very often, this is more likely to be the case where there is a significant distance to the nearest office.

It is important that the most appropriate contract is selected to ensure compliance with tax rules and to avoid any unexpected tax liabilities. For example, a home-based worker may be eligible to claim travel payments but where these are regular they are likely to be a taxable benefit.

Occasional, part-time, or full-time homeworking can all be facilitated by the flexibility of hybrid contracts.

MPs who are considering home-based employment must seek advice from the House of Commons Members HR team to ensure they are following best practice.

Members’ HR has produced detailed guidance on homeworking and other flexible working arrangements.

For staff members to be moved onto a home-based contract, the MP should complete a contract variation letter to amend the existing employment contract. Please send a copy of the variation letter to payroll@theipsa.org.uk.

For new starters, the MP must select the "home-based" option when using the MPs’ Staff new starter tool. The new contract can be submitted to IPSA with new starter paperwork as normal.

Any new home-based contracts/variation letters received by the normal payroll cut-off date (the 15th of each month) will be taken into account when setting up payment of the allowance with that month’s payroll.

If contracts/variation letters are received after the payroll cut-off date, the allowance will begin from the following month and, if relevant, backdated to the effective date of the change.

Hybrid or office-based contracts eligible and the homeworking allowance

Staff on hybrid or office-based contracts are not eligible for the homeworking allowance.

MPs may claim for hospitality costs from their office costs budget.

This can include things like tea and coffee to offer visitors to the constituency office or light/modest refreshments at a meeting or event.

It is not intended to cover routine meal or refreshment costs for the MP, staff members or others. Team meals out (for example, at a pub or restaurant) or social events are also not claimable.

When you make changes to your property, you need to provide us with specific documentation as evidence.

The types of documentation you must provide are outlined in our property amendment form evidence requirements.

Read more about completing a property amendment form.