Working From Home Tax Relief – Everyone has been in trouble since the first pride of novel coronavirus in the United Kingdom. People have been forced to stay home and do work from home when offices were shut down due to fear of spreading the novel coronavirus.
Now more than a million people have been working from home, and it has increased their household costs. The government of the United Kingdom is taking care of every need of the citizens during a time of crisis.
After the spread of COVID-19, the government of the United Kingdom introduced a new working from home tax relief for every eligible taxpayer in the country. As per the HM Revenue and customs, now you can apply for your tax relief and ask for a claim. Still, many people don’t know about it. That is why we are here to discuss each and everything regarding working from home tax relief. So let’s take a look at it.
What Is Working From Home Tax Relief?
Working from home tax relief is income tax relief for all the eligible taxpayers of the United Kingdom. As per the latest rules, if your employer asked you to work from home because of the coronavirus, you might be eligible to get working from home tax relief.
As millions of people start working from home, it increases dear household costs. The government of the United Kingdom believes working from home tax relief will give them some sort of hope and lower the cost of working from home.
As per the director-general of Revenue and Customs, more than half a million people have already reduced their income tax by £125. He also mentioned in his statement that the government wants everyone who is eligible to get benefits to apply quickly. The whole process is available online, and it is very easy to do.
How Much Can You Claim Under Working From Home Tax Relief?
As per the new rules, text years before 6th April 2020 you can claim £4 a week. This means if you are paying the basic 20% pay rate, then you are able to claim 20% of £4 a week which will roughly come to around £41 a year.
But, after the first spread of the novel coronavirus, the government of the United Kingdom changed its rules of working from home tax relief, and now you can claim up to six pounds a week.
For example, you pay the basic tax rate of 20% now, and you will be able to receive £1.2 a week. The rough calculation of yearly tax relief will be around £62 on the basic tax rate.
On the other hand, if you are paying a higher tax rate, such as 40%, then you will be able to receive £2.4 a week. Your annual calculation of tax relief will be around £124.
Tax relief calculation based on £6 a week.
- £1.20 a week for a basic 20% rate taxpayer (£62.40 a year)
- £2.40 a week for a higher 40% rate taxpayer (£124.80 a year)
- £2.70 a week for a top 45% rate taxpayer (£140.40 a year)
HM Revenue and Customs have already made it clear if you have not claimed any relief for working from home last year, then you are eligible to claim it as a backdated. The ministry will accept your request, and you will be paid a lump sum amount for any successful backdated claims.
You do not have to provide any evidence that your post of living has increased due to working from home, but if you are applying for any relief above the £6 per week flat rate, then you have to provide evidence of the increased cost.
Who Is Eligible To Claim To Work From Home Tax Relief?
Now let’s talk about the eligibility to claim to work from home tax. It is not as hard as everyone thinks in the United Kingdom. Apart from that, it is also true not everyone is eligible to claim work from home tax relief.
There are certain conditions that you have to fulfill before you apply for tax relief, or the ministry might reject your application.
First of all, you are only eligible if your employer asks you to work from home.
You should not be receiving any expenses directly from your employer to cover the extra costs of your working from home.
You use your own money for things that you should buy for your job while you are working from home.
You only use those things for your work, not your own entertainment or leisure.
You may be able to claim tax relief for gas and electricity, metered water, business phone calls and Internet access.
Kindly remember you cannot claim the whole bill. You just have to claim the part that relates to your work.
If you are taking any sort of benefit from your employer to work from home, then you are not eligible for the working from home tax relief.
For example, you were forced to have a fresh dial-up Internet connection, and your employer paid you the whole money. Now you cannot claim any working from home tax relief against the dial-up connection.
Kindly remember you don’t need to work full time from home to receive any working from home tax relief.
How To Claim To Work From Home Tax Relief?
Now let’s take a look at all the simple steps you have to take in order to claim to work from home tax relief.
- First of all, click on the button given above to reach the official website of the UK government. The link will also redirect you to the tax relief claim page.
- Under the tax relief claim page, you can scroll down and check for the green colour button named check if you can claim.
- As soon as you click the button, it will take you there question near where you have to fill a simple question.
- After asking a few simple questions, it will tell you you can only claim tax relief for current years using the service.
- If you want to claim previous years, then you have to use a self-assessment tax return.
The novel coronavirus has been getting hard for every citizen of the United Kingdom for more than two years. Since the first spread of the virus, the government has been doing everything in its capacity to relieve people in a hard time.
After a free vaccination, COVID testing, masks, now the government of the UK has a note that if fresh working from home tax relief claims for every eligible citizen of the United Kingdom.
As for the new rules, every eligible person can claim for working from home tax relief up to £6 a week. The rough calculation of six pounds every week comes between £62 a year or £140, depending on your tax slab.
As per the latest guidelines, everyone is eligible to claim to work from home tax relief if they were requested by their employer to work from home. Apart from that, they did not receive any relief or direct payment from their employer to cover the costs of working from home.
Don’t worry. If you have not received any claims for the past four years and you are eligible to claim, then you can apply for them. The Ministry of Revenue will accept your application if you are eligible.
Can I use any third-party portal offered by my agent to apply for tax relief?
No, as per the latest guidelines issued by the government of the UK, the service is completely free and easy to use for every eligible person. You should apply your claim on your own using the online portal. Agents will not be able to use the online portal to apply for that working from home tax relief on behalf of the customer.
How many people have applied for working from home tax relief in the United Kingdom?
As per the latest statistics released by Revenue and Customs, more than 3 million people claimed for working from home tax relief from the year 2020 to 2021. The ministry is expecting the same number to claim to work from home tax relief once again during the tax year 2021 to 2022. Even though the cases of COVID are going down, companies are still taking extra precautionary steps and not allowing many people in the office.
I was required to work from home last year, but I did not claim any tax relief. Can I apply for tax relief this year?
Yes, even if you missed claiming your tax relief last year after working from home, you can still apply for it. As per the latest guidelines issued by HMRC, they will accept backdated claims for up to four years. Kindly remember you have to provide some sort of proof that your household spending was increased due to working from home, and you have not received any relief from your employer against the same.