Tax relief for those who have to work from home

31 August 2021

Due to the COVID-19 pandemic, many of us have had to work from home. As a result, more employees than ever have claimed tax relief for the 2020/21 tax year for the additional costs incurred as a direct result of working from home. As the pandemic has continued into the current year, is likely that many employees will also be eligible to make a claim for relief in the 2021/22 tax year. Employees who have been required to work from home, even if only for one day, are entitled to claim tax relief. This relief is not, however, available to those who choose to work from home.

Tax relief can be claimed on the proportion of expenses which relate to your work for example, gas and electricity, metered water, and business phone calls. To claim for the exact amount of the additional costs, evidence of these costs must be kept such as receipts, bills, or contracts. Alternatively, a flat rate of £6 a week from 6 April 2020 can be claimed with no evidence of additional costs incurred required. Claiming the flat rate of £6 per week can generate tax savings of up to £125 per year for those who are eligible in the 2020/21 tax year. Additionally, claims can be backdated by up to 4 years and successful claims will receive a lump sum payment from HMRC.

Relief can be claimed through your self-assessment tax return or by applying through the GOV.UK online service. Using the online service, tax relief will be given directly through your salary until March 2022 by an adjustment made to your tax code.

If you would like any assistance or advice around claiming tax relief for working from home, please contact Jill Walker, or get in touch with your usual contact at AAB.

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