Working from home may bring unexpected tax relief so don’t miss out

HM Revenue and Customs (HMRC) Director General for Customer Services, Myrtle Lloyd, said more than half a million employed workers have already reduced their income tax by up to £125, and are benefitting from their working from home tax claim expenses.

“We don’t want any eligible employees to miss out on the benefits, and it is so quick and easy to check online to see if you can apply”.

Taxpayers can check if they are eligible via GOV.UK.

To claim for the working from home tax relief, employees can apply directly via GOV.UK for free, or by searching ‘working from home tax relief’.

“Once an application has been approved, the online portal will adjust the employees tax code for the 2021/22 tax year. They will then get their tax relief directly through their salary until March 2022”.

Mr Lloyd said since April 2020, the amount employers have been able to pay tax-free without employees having to provide evidence of an increased bill is up to £6 a week.

Employees who have not received the working from home expenses payment direct from their employer can apply to receive the tax relief from HMRC.

Those eligible can claim tax relief based on the rate at which they pay tax. For example, if an employed worker pays the 20% basic rate of tax and claims tax relief on £6 a week, they would receive £1.20 a week in tax relief (20% of £6 a week) towards the cost of their household bills. 

Employees required to work from home last year who did not claim for the tax relief, haven’t missed out, as the HMRC will accept backdated claims for up to four years. They will get a lump sum payment for any successful backdated claim.

The HMRC emphasised their GOV.UK service was quick and free, whereas using a tax agent to apply for working from home tax relief, could incur fees or commission that could be avoided.

“Customers who use the HMRC portal direct will get 100% of the tax relief that is due, and agents will not be able to use the portal to apply for the relief on a customer’s behalf.”

“HRMC is continuing to help and support people affected by the pandemic.”

The online portal for working from home expenses is: https://www.gov.uk/tax-relief-for-employees/working-at-home