If you’ve been working from home in recent years, you might be eligible for a tax relief payment from HMRC worth up to £140. This tax relief helps cover the additional costs of working remotely, such as higher energy bills and internet usage. Here’s a detailed guide on eligibility, how much you can claim, and how to apply for this relief.
Knowing
HMRC introduced the working from home tax relief to support employees facing increased household costs due to remote work. This initiative started during the COVID-19 pandemic, when millions of employees were required to work from home. The relief covers costs like heating, electricity, and internet usage but not everyday expenses like rent or council tax.
Eligibility
To qualify for this tax relief, you must meet the following criteria:
- Your employer must have instructed you to work from home.
- You must have incurred additional costs due to working remotely.
- Your employer should not have reimbursed you for these costs.
- You must be a taxpayer in the UK.
If you voluntarily chose to work from home, you won’t be eligible for this relief.
Amount
The tax relief amount depends on your income tax band. HMRC provides a flat-rate relief of £6 per week, calculated annually based on your tax rate:
| Tax Rate | Weekly Relief | Annual Relief |
|---|---|---|
| Basic (20%) | £6 | £62.40 |
| Higher (40%) | £12 | £124.80 |
| Additional (45%) | £12.60 | £140.40 |
This flat rate applies regardless of the actual amount you spend on utilities for work purposes.
Examples
For example, Emma, a basic rate taxpayer, works from home two days a week. She can claim £62.40 per year. John, a higher rate taxpayer working from home full-time, can claim £124.80 annually. These savings can help offset the added costs of remote work.
Claim
Claiming the tax relief is straightforward. Here’s how you can apply:
- Check eligibility: Confirm that you meet all the criteria.
- Apply online: Use HMRC’s portal by logging in with your Government Gateway ID. The system will calculate your relief amount and adjust your tax code accordingly.
- Self-assessment: If you file a self-assessment tax return, include the relief in your return to reduce your tax bill.
- Check tax code: After claiming, verify your tax code on your payslip to ensure the relief is applied correctly.
Backdating
One of the most beneficial aspects of this relief is that you can backdate your claim for up to four years. If you worked from home during previous tax years, you could receive a significant rebate by claiming for all eligible years.
Mistakes
Common mistakes to avoid include claiming when not instructed to work from home, including non-eligible costs, and missing deadlines. Always double-check your eligibility and apply as soon as possible to avoid losing out.
FAQs
Who qualifies for HMRC’s home working tax relief?
Employees instructed by their employer to work from home and incur extra costs.
How much tax relief can I claim?
Up to £140 annually, depending on your tax rate.
How do I apply for the tax relief?
Apply via HMRC’s online portal or through self-assessment tax return.
Can I backdate my tax relief claim?
Yes, you can backdate claims for up to four years.
What costs are covered by this relief?
Additional costs for heating, electricity, and internet used for work.
