Tax relief for working from home during the pandemic — here’s how to claim tax relief and how much to expect

·3-min read
If you’ve worked from home — even for one day — during the pandemic you can apply for tax relief (Shutterstock / Brian A Jackson)
If you’ve worked from home — even for one day — during the pandemic you can apply for tax relief (Shutterstock / Brian A Jackson)

You can now backdate your tax relief claim if you worked from home during the coronavirus pandemic.

People who worked from home during the pandemic could be eligible for tax relief — of up to £125 a year — even if they only did so for one day.

Employees returning to the office can still claim for household expenses for this tax year, says HM Revenue and Customs (HMRC), whose figures revealed nearly 800,000 have claimed tax relief since April.

Myrtle Lloyd, HMRC’s Director General for Customer Services, 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.”

Am I eligible for working from home tax relief?

You can claim the full year’s tax relief entitlement of £125 if your employer told you to work from home — even if it was only for one day.

It doesn’t matter if you have returned to the office since early April — you can still get the full amount for the 2021/22 tax year. It’s OK if you work from home for just some of the week.

However, you cannot claim tax relief if you choose to work from home. Nor can you claim tax relief if your employer covered your expenses or paid you an allowance.

If you complete an annual tax return, you will be able to apply for the tax relief via your Self Assessment.

How to apply for working from home tax relief

You can use the HMRC working from home tax relief portal, where you will be asked a series of questions to check if you are eligible or not. To progress with your claim, you will need a Government Gateway user ID and password, which you can create if you don’t already have one. HMRC says it takes about 10 minutes to create.

What documents do I need for my claim?

To create a Government Gateway ID, you will need your National Insurance number and a form of ID such as a recent payslip or P60, or a valid UK passport. If you are claiming an exact amount for costs then you will need evidence such as receipts, bills or contracts.

How much tax relief can I claim?

Each employee can claim up to £125 per year. This is made up of either £6 a week from April 6, 2020, or the exact amount of extra costs incurred above the weekly amount, which you will need the evidence mentioned above for.

Tax relief is based on the rate at which you pay tax, so if you pay the 20 per cent basic rate of tax and claim tax relief on £6 a week you would get £1.20 per week in tax relief (20 per cent of £6) which would result in £62.40 a year. Higher rate taxpayers can claim £2.40 a week (40 per cent of £6 a week), which would result in £124.80 a year.

What can I claim tax relief for?

You may be able to claim tax relief towards bills including gas and electricity, metered water, business phone calls and internet costs. You cannot claim for the whole bill — just the part that relates to your work.

How will I get the money?

Once your application has been approved, your tax code will be adjusted for the 2021/22 tax year and you will receive the tax relief directly through your salary.

How to backdate a claim

If you were required to work from home during the 2020/21 tax year but did not claim for the tax relief, it’s not too late.

You can backdate claims for up to four years and will receive a lump sum payment if you are successful.

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