Working from Home Tax Relief on Expenses

The treasury has recently confirmed that due to the ‘very fluid’ working from home situation this year, anybody who has had to work from home will be able to claim tax relief based on £6 a week from 6 April 2020 to 5 April 2021. For a basic rate taxpayer, this would be worth a tax saving of £1.20 a week (20% of £6 a week), which equates to a reduction in tax of £62.40 for the year. For a higher rate taxpayer, the tax saving would be £2.40 a week (40% of £6 a week) resulting in a saving for the year of £124.80.

The tax relief is for employees who have not received the working from home expenses payment directly from their employer. Employees will not be required to provide evidence to show their bills have increased unless they are applying for tax relief on costs above the £6 per week flat rate.

To accommodate the volume of claimants HMRC has launched an online portal from which you can make a single claim for the full 2020/21 tax year. Once processed, an adjustment will be made to your tax code which will provide tax relief by having less tax taken off your pay each month for the rest of the year, meaning you take home more.

Individuals who complete a self-assessment form each year won’t be able to use the online portal instead the allowance can be claimed when your self-assessment form is completed.

To use the portal, you will need your Government Gateway ID. If you do not have one then you can create one when you are asked to sign in for the process of making your claim. To create your ID, you will need your National Insurance number and a recent payslip or P60 or a valid UK passport.

Follow the link below and click on ‘Check if you can claim’.

https://www.gov.uk/tax-relief-for-employees