Working at home, then going back to the office, then back at home – the past year was very different than everything we’ve seen so far. If you are one in a million people who have transitioned from working from the office to working from home, you have come to the right place!
Whether you have to work from home part of the week or on a regular basis, you can claim tax relief (for a whole year even if you worked from home just for a day)! Note that this doesn’t apply to employees who have chosen to work from home. Down below, we are explaining which expenses are included and how much relief you can get.
What’s Included?
You can get tax relief for your remote working expenses – water bills, heating, electricity, broadband connections, home contents insurance, etc. Rent, mortgage interest, and council tax don’t fall in this category as these are the costs that would stay the same no matter if you are working from home or your office.
Tax relief also includes equipment and furniture you have bought to make working from home less stressful and more productive, such as lamps, second screens, chairs, laptops, etc.
More than 1.4 million people have claimed tax relief by the end of 2020. Clearly, numerous companies are still closing workplaces, which means their employees are working remotely. In other words – last year’s “trend” applies to this year as well.
HMRC recognised the situation as very fluid, which is why they accepted all the last year’s claims, including claims of people who have worked only for a day or one week from home. Also, they will accept remote workers’ claims in 2021 if they transitioned to working from home due to coronavirus measures. For some, working from home has been on and off for months now. HMRC wanted to put an end to putting in multiple claims and contacting them every time people have to work from their homes again.
Which Options Do You Have?
Proving the exact before-and-during-covid difference in your heating and electricity bills can get a bit complicated. Instead, we highly advise you to claim a rate of £6/week. Here, ‘s why. You have 2 options – either you can claim tax relief of £6/week or ask for an allowance of £6/week extra tax-free. In this case, the amount your employers give you is free from tax and you won’t be making any special arrangements.
However, asking for an allowance now may not be a good idea, which is why we believe you should claim tax relief on £6/week where your employer doesn’t pay for the extra costs but this amount is deducted from your taxable income. A great thing about this option is that you wouldn’t have to prove your extra costs, keep receipts, etc.
In case you think your extra costs are higher than £6/week, there’s still a chance you may get tax relief but this would be time-consuming and uncertain.
Summary
There’s no doubt you can get tax relief if you are one in a million remote workers in the UK. And you know what? You totally deserve it! In case you feel like you don’t, claim it and donate what you get to a charity.
