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Claiming tax relief for working from home

How to claim tax relief for working from home

Could you get a tax refund from HMRC?  HMRC statistics show that, since April, nearly 800,000 employees have claimed tax relief for working from home during the pandemic.  That adds up to around £49,950,000 or more ….but, with around 4m+ employees working from home, that still leaves a lot of people, and a lot of cash, to claim for working from home from the taxman!

Who can claim?

With lots of people working from home this is a popular tax break but, you can only claim if you have to work from home because your employer has told you to – or if it is written in your employment contract that you work from home.  In taxman parlance this has to be an objective requirement of your employment – which means it has to be your employer’s choice and not yours.

If you have returned to work to the office recently or are about to then you can still claim this tax break for 2021/22 (the current tax year)

Tax coding notice changes

If you claim for the current tax year, you should see an adjustment to your notice of tax code – to make it a smaller number – and that will result in you paying less tax and the tax relief is applied automatically going forward.

How much is it?

There are two ways to work out how much to claim – by either claiming the statutory amount or by claiming the extra costs incurred.   Claiming the statutory amount is simplest as otherwise you have to provide evidence of how you have calculated the extra costs.

The statutory tax relief available is based on £6 a week and eligible employees will receive tax relief based on their highest rate of tax. i.e. a 40% taxpayer would receive £2.40 per week towards the cost of their household bills or nearly £125 per year.  Note for the years 2012 to 5 April 2020 the rate was £4/week.

If you think it costs you more than £6/week to work from home then please request a free copy of our Working from Home Help Sheet by emailing us at [email protected].  You can use this to help work out how much to claim.

Can I make a backdated claim?

If you haven’t already claimed then you have up to four years to apply. Which also means that if you were eligible to claim for working form home in any of the previous four years, you can also make a back claim (as far back as April 2018 which is the 2018-19 tax year).

How to claim

Claims for working from home tax relief can be made via HMRC’s online portal

Claims for tax relief for working from home can be made via the taxman’s online portal at this link https://www.gov.uk/tax-relief-for-employees/working-at-home.   If you are a client then please email [email protected] and make sure we have information from you to be able to claim this as part of your tax return.

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