As we approach the end of lockdown and many of us begin to return to work after months of working from home, you may be wondering if it is still possible for you to claim tax relief for the time you spent working from home. In this guide, we’re going to be taking a look at whether you can still claim.
HMRC recently confirmed that workers can still claim working from home tax relief without submitting evidence of increased bills, even if they have since returned to the office. So long as you have spent at least one day working from home since 6th April 2021, you can make a claim.
More than 550,000 workers have already claimed since the new tax year began and are benefitting from the tax relief, reducing their bills by up to £125. However, as HMRC received over 3 million claims for 2020-21, it’s expected that millions of workers could be missing out on this year’s claim.
How To Make a Tax Relief Claim for Working from Home
Before making a claim for the tax relief, you should first check whether or not you’re eligible.
In order to claim, you must:
- Only be making a claim for expensive for working from home
- Not pay tax by self-assessment
- Not have had your expenses already paid for by your employer
- Have started working from home due to the coronavirus pandemic
- Have encountered higher costs due to working from home
The government has aimed to make the process for checking your individual eligibility as quick and easy as possible and have created an online eligibility tester. You can check if you’re eligible to claim tax relief for working from home here.
Once you’ve checked if you’re eligible, if you are able to make a claim, you’ll either be directed to your government gateway sign in page to start your claim or you can apply here.
Here’s How Much You Can Claim
The tax relief you can receive will depend on your income tax band. All taxpayers can claim a flat rate of tax relief on £6 a week and basic-rate taxpayers will gain £1.20 a week (20% of £6), equating to £60 a year. Higher-rate taxpayers can gain £2.40 per week (60% of £6), equating to £125 a year.
You can either claim tax relief on:
- £6 a week from 6 April 2020 (for previous tax years the rate is £4 a week) and you will not need to keep evidence of your extra costs.
- The exact amount of extra costs you’ve incurred above the weekly amount – you’ll need evidence such as receipts, bills or contracts.
The tax relief you can receive will depend on your income tax band. All taxpayers can claim a flat rate of tax relief of £6 a week and basic-rate taxpayers will gain £1.20 a week (20% of £6). Higher-rate taxpayers can gain £2.40 per week (60% of £6).
What can you claim for?
- Gas and electricity
- Metered Water
- Business phone calls, including dial up internet access.
You can’t claim the whole bill, but you can claim on the part that relates to your work. You can even claim on any equipment you’ve bought in order to facilitate your working from home e.g. a laptop, chair, mobile phone.
You won’t need to provide evidence to show your bills have increased unless you’re applying for tax relief on costs above £6 per week flat rate. This is usually for self-employed workers who typically have larger expenses and evidence of the increased costs through receipts and invoices etc..
Once workers have submitted a claim and the online application has been approved, HMRC will adjust their tax codes for the 2021-2022 tax year. The employee will then receive the tax relief directly through their salary until the end of March 2022 or they can receive the tax relief as a lump sum payment if they wait and apply once the 2021-22 tax year has ended.
A spokesman from HMRC said:
“We recognise that the working from home situation is very fluid at the moment, so we’re accepting claims for the full year’s expenses. That includes even if people have only worked from home for some of the year, to avoid needing to contact us if you have to work from home again.”
I Work From Home and In the Office, Can I Still Claim?
Yes, you can still claim if you have made a home working arrangement with your employer and work at home on a regular basis so long as there is a recognisable pattern e.g. 3 days at home and 2 at your usual place of work.
Missed Out on Last Year’s Relief? Don’t Worry!
If you didn’t make a claim for relief for the previous year, don’t worry, you can still benefit by submitting a backdated claim. HMRC will accept backdated claims for up to 4 years and you will receive a lump sum for any successful claims.
For more information and advice on your taxes, please don’t hesitate to get in touch with our team at Ryans who will be more than happy to answer any queries you may have. You can also check out more of our helpful blogs to stay updated on the latest financial news.