The demand for work from home tax relief is growing

HMRC announced that it has already processed 794,819 working from home tax relief claims for the 2021-22 tax year. This increase is due to the need for many people to work from home due to the Covid 19 restrictions.

If you are instructed to work from home by your employer, there is a special tax relief for your extra expenses. Don’t miss out.

What is the cost of working from home tax relief?

If you qualify, you can claim tax relief at a flat rate of 6.00 per week from April 6M 2020, every week you work from home. This means that you do not have to provide any proof of your related expenses. This accounts for the extra money you have to pay on top of your normal household bill.

Tax relief is applied at the rate at which you pay income tax. This is 20% basic rate, 40% over rate and 45% over rate. So if you apply for 6.00 per week, the tax relief is:

  • 20% Basic Rate: 20 1.20 per week, or. 62.40 per year (x 52)
  • 40% higher rate: £ 2.40 per week, or £ 124.80 per year
  • 45% extra rate: £ 2.70 per week, or £ 140.40 per year

If you still do not claim to work from home tax relief, do not panic. HMRC backdates such claims for a maximum of four tax years. For the years prior to 2020-21, the flat rate amounts to £ 4.00 per week. If you claim for the previous year, you will receive your payment individually.

How do I claim Home Tax Relief from a job?

Myrtle Lloyd, HMRC’s Director General of Customer Service, said:

“More people are returning to office now, but if they worked from home during the epidemic, it would not be too late to apply for tax relief on family expenses.

“Quick and easy to check if you are eligible and to apply online you need to go to GOV.UK and search for ‘work from home tax relief’.

Here is the link to the portal. It is designed to be used by individual employees, not tax agents. This will take you through a series of yes / no questions to determine which system you need to use to make the claim. If you claim to work flat rate only from Home Tax Relief, you will be able to do so through this link.

If you claim other work costs over 2,500, you will be asked to go the other way.

Keep in mind that working from home tax relief only applies to employees who have to work from home by their employer. This does not apply if you want to work from home.

It tells me I need to file a self-assessment tax return …

At the moment, many people give up trying to complete any kind of tax relief claim because it seems to be more of a hassle than its value. But that means you are leaving your hard-earned cash, which you are entitled to return to HMRC’s bank account. Would you rather have it in you? Or at least reduced your income tax bill a little?

If you have already filed a tax return for any other reason, you will need to include work from Home Relief on the relevant employment page.

You do not want to be frustrated if you cannot get the right pitch so invest in a good capo. And you don’t have to deal with the self-assessment system yourself. We’ll pick it up for you (to maximize your tax relief and make sure you’re fully committed).

Even as an employee, checking who is entitled to tax relief and allowances on the cost of work can save a good chunk of change every year. It’s not just for self-employed.

Tony Shanks
Director of Operations
ATT member

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