Working from home tax relief

Employees who working from home may be able to claim tax relief for some of the bills they pay that are related to your work. Employers may reimburse employees for the additional household expenses incurred if regularly working at home. The relief

Employees who working from home may be able to claim tax relief for some of the bills they pay that are related to your work.

Employers may reimburse employees for the additional household expenses incurred if regularly working at home. The relief covers expenses such as business telephone calls or heating and lighting costs for the home-based workspace. Expenses that are for covering private and business use (such as broadband) cannot be claimed. Employees may also claim tax relief on equipment they have bought, such as a laptop, chair or mobile phone.

Employers can pay up to £6 per week (or £26 a month for employees paid monthly) to cover an employee’s additional costs if they have to work from home. Employees do not need to keep any specific records if they receive this fixed amount.

If the expenses or allowances are not paid by the employer, then the employee can claim tax relief directly from HMRC. Employees will qualify for tax relief based on their highest tax rate. For example, if they pay the 20% basic rate of tax and claim tax relief on £6 a week, they will receive £1.20 per week in tax relief (20% of £6). Employees can claim more than the quoted amount but will need to provide evidence to HMRC. HMRC will accept backdated claims for up to 4 years.

Employees may also be able to claim tax relief for using their own vehicle, be it a car, van, motorcycle or bike. As a general rule, there is no tax relief for ordinary commuting to and from your regular place of work. The rules are different for temporary workplaces where the expense is usually allowable or if and when an employee uses their own vehicle to undertake other business related mileage.

Note, that if an employee who agreed with their employer to work at home voluntarily, or they if they choose to work at home, they cannot claim tax relief on the bills they have to pay. If an employee previously claimed tax relief when they worked from home because of coronavirus (COVID-19), they may no longer be eligible for relief.

Source: HM Revenue & Customs Tue, 05 Dec 2023 00:00:00 +0100

Latest INSIGHTS

Check out our latest Insights for useful accounting tips and information.

Falling inflation – what does it mean for you?

The following notes are reproduced from a Treasury statement issued 21 May 2024.

Lower inflation supports people by maintaining the purchasing power of their money.

If prices only rise slowly, people can plan their budgets more effectively –

Read More

New Brooms

As time passes during the present election campaign, its seems more likely that we may have a change of government from the 5 July.

Labour have disclosed a number of tax changes they would introduce. To summarise they are:

Private school fees

Read More

Tax Diary July/August 2024

1 July 2024 – Due date for corporation tax due for the year ended 30 September 2023.

6 July 2024 – Complete and submit forms P11D return of benefits and expenses and P11D(b) return of Class 1A NICs.

19 July 2024 – Pay Class 1A NICs (by the 22 July

Read More