Did you know that if you are required to work from home that you can claim tax relief? This has in fact been the case prior to the work from home message, circulated by the government throughout COVID-19.
However, many employed individuals have lacked awareness of this personal benefit, readily available to them.
As tax relief while working from home is ranked as an unfamiliar benefit, highly prevalent in today’s climate, here at The Financial Management Centre, we’ve collated a handy FAQ page.
We hope to increase awareness of the working from home tax relief benefit, helping to contribute towards the extra costs of operating from a domestic property.
If your employer requires you to work from home, whether for a singular day, on a part-time basis, or on a full-time basis, throughout this financial year, you can in fact claim an entire year’s worth of tax relief.
This is in place to support home workers with the extra costs linked to operating from home, rather than an employer’s office. Those costs can be anything from electricity bills, to internet and heating.
Naturally, many workplaces are now operating on a work from home basis. Millions of UK workers have adapted their working days by setting up from their personal spaces.
With an understanding that great demand for financial support is needed, HMRC have created a streamlined microservice, making the claiming process easier and accessible for tax relief.
To help you access tax relief while working from home, here’s the ins and outs, from eligibility to the claiming process.
Can I receive tax relief while working from home?
Yes, you can receive tax relief in relation to your working arrangements if your employer requires you to operate from your domestic property. Here’s where you’ll have the opportunity to claim for increased spend on bills, all linked to your working activity.
What is the eligibility for working from home tax relief?
You are eligible for tax relief if you work from home, requested by your employer. This benefit, unknowingly to many was on offer prior to the spike in work from home requirements.
With this in mind, if you’ve always worked from home, you are eligible. If you’re now working from home, in relation to the hit of coronavirus, you can again claim for tax relief.
How much can I claim?
It can be very difficult to gauge exactly how much tax relief each individual worker will require, especially when considering personal bills. To make this easier, as a standard, you can claim £6 a week.
If you do however believe that you’re owed more than £6, a higher claim for tax relief can be made. However, you will need evidence of your increased spend, by working from home.
How can I claim tax relief?
There are two ways that you can claim HMRC tax relief.
- Your employer can pay you £6 extra a week, tax-free. However, down to current struggles, it’s probably best that you avoid this.
- You can personally claim £6 a week, which can be automatically deducted from your taxable income. This can become a standardised process, especially if you are only claiming the baseline of £6.
Through the second option, you can head over to the HMRC work from home microservice, where you’ll be able to easily claim a full year’s worth of tax relief. This will cover the 2020/2021 financial year.
To complete your claim, you’ll need your Government Gateway ID, which will automatically adjust your tax code. If you do not have an ID, you can create one through your claim, helping you access the helpful support of working from home tax relief.
Can I receive tax relief while working from home part-time?
Tax relief while working from home can be accessed, even if you’ve only worked one day from home. As companies are still impacted by COVID-19, it’s difficult to gauge whether the work from home requirements will continue.
With this in mind, you can claim for the entire year, just in case your working arrangements do again change.
If you’re purely working from home, where others are visiting the workplace, you can still claim tax relief as your personal costs will still be affected.
Why haven’t I received a full year of tax relief prior to COVID?
Prior to COVID-19, working from home was more of a benefit. The majority of workplaces would avoid this recommendation.
However, as the trend of working from home has emerged, it’s understandable that you may have made previous claims for tax relief prior to 23rd March 2020. In this instance, you’ll receive tax relief for the number of weeks you worked from home for.
If this is your situation, you can now make a claim for the rest of the financial year through an online or postal P87 form.
Can we claim working from home tax relief as an individual benefit?
Yes, tax relief is an individual benefit. With this in mind, if you live with someone else who’s also been recommended to work from home, you can both complete a claim, as costs will have likely doubled.
Contact the Financial Management Centre for all your financial needs
At TFMC, we hope that the above FAQ has increased your awareness around HMRC’s tax relief benefit. In this, we also hope that you’ll head over to their website and complete a claim, ensuring that your working from home costs can be covered.
If you do however require support with tax relief, or with your financial affairs, we are here to assist you. We’re currently living through a weird time, where every penny, counts.
We can help you by ensuring that you are managing your books properly, to sourcing the correct type and amount of financial support via the government.
Reach out today for more information on our services, or for greater guidance on tax relief while working from home.
Although it may feel strange to claim for bills, which are linked to your personal home, please remember that you do have the right to claim tax relief if your working arrangements are requested and legitimate.