HMRC announce that they’ve processed 794,819 Working from Home tax relief claims for the 2021-22 tax year already. The increase is mainly due to the need for many people to work from home because of Covid 19 restrictions.
If you were instructed to work from home by your employer, there’s a tax relief specifically for the additional costs you incur. Don’t miss out on yours.
What’s the Working from Home tax relief worth?
If you’re eligible, you can claim tax relief on a flat rate amount of £6.00 per week from April 6th 2020, for each week you work from home. This means that you don’t need to provide any evidence of your related expenditure. It’s to account for the extra you have to pay on top of your usual household bills.
The tax relief is applied at the same rate as you pay income tax. That’s 20% Basic Rate, 40% Higher Rate and 45% Additional Rate. So if you apply that to the £6.00 per week, the tax relief is:
- 20% Basic Rate: £1.20 per week, or £62.40 per year (x 52)
- 40% Higher Rate: £2.40 per week, or £124.80 per year
- 45% Additional Rate: £2.70 per week, or £140.40 per year
Don’t panic if you’ve not claimed for working from home tax relief yet. HMRC backdate this type of claim for a maximum of four tax years. For the years before 2020-21, the flat rate amount is on £4.00 per week. If you’re claiming for previous years, you’ll receive your payment as a lump sum.
How do I make a working from home tax relief claim?
HMRC’s Director General for Customer Services, Myrtle Lloyd, said:
“More people are getting back to office working now, but it’s not too late to apply for tax relief on household expenses if they’ve been working from home during the pandemic.
“It’s quick and easy to check if you’re eligible and apply online you should go to GOV.UK and search ‘working from home tax relief’.
Here’s the link to the portal. It’s designed to be used by individual employees, not tax agents. It’ll take you through a series of Yes/No questions to establish which system you need to use to claim. If you’re just claiming flat rate working from home tax relief, you’ll be able to do it through this link.
If you’re claiming for other work expenses that are worth more than £2,500, then you’ll be asked to go down a different route.
Remember that working from home tax relief only applies to employees that are required to work from home by their employer. It doesn’t apply if you chose to work from home.
It’s telling me I need to do a Self Assessment Tax Return…
At this point, lots of people give up trying to complete any kind of tax relief claim because it seems like more hassle than its worth. But that means that you’re leaving your hard earned cash, that you’re legitimately entitled to have back, in HMRC’s bank account. Wouldn’t you rather it was in yours? Or at least brought your income tax bill down a bit?
If you already complete a tax return for another reason you need to include the working from home relief on the relevant employment page.
You don’t have to miss out on getting your money back. And you don’t have to tackle the self assessment system yourself. We’ll sort it for you (maximising your tax relief and making sure you’re totally compliant).
Even as an employee, checking out what work expenses tax reliefs and allowances you’re entitled to can save you a good chunk of change each year. It’s not just for the self employed.
