Claim tax relief for your job expenses
HMRC explained its practice of claiming £6 per week homeworking tax deduction for employees, although this could be a temporary allowance for 2020/21.
Employers have been allowed to pay employees up to £6 a week tax-free from 6 April 2020 to offset extra expenses if they must operate their work from home. Employees who have not obtained the allowance direct from their employer are able to apply to this arrangement to receive the tax relief from HMRC.
You might be able to claim tax relief if:
- You use your own money for things that you must buy for your job
- You only use these items for your work
You are unable to claim tax relief if your employer either gives you:
- All the money back
- Another alternative, for example gives you a laptop but you want a different type of laptop
Working from Home
The reform in practice by HMRC has allowed employees who are expected to work at home to claim £6 per week (£26 per month) as a deductible cost against their employment income if they do not obtain their employer’s maximum homeworking allowance. This includes if you must work from home because of COVID-19.
If you decide to work from home on your own behalf, you are not entitled to claim tax relief.
Additional expenditures such as heating, metered water costs, business calls or a new internet/broadband connection. They do not include expenses such as mortgage interest, rent or council tax that will remain the same if you were working from home or in an office.
Method to claim
The online portal released on 1 October 2020, is easy to use and has been set up to process tax relief on added costs for working employees who have been advised by their employer to work from home to help avoid the spread of COVID-19. HMRC is hoping to convince more people to make claims for their homeworking expenses. Using this online service, over 54,800 individuals to date have made a claim.
If an online claim is filed now, the PAYE code of the employee may be changed such that the tax relied for the remainder of this tax year is issued at source.
The HMRC guideline notes that to claim the deduction, the employee must routinely work from their home, so two weeks spent working from home while self-isolating would not qualify the employee to claim the homework deduction for the entire tax year.
However, if an employee was originally working from home and notified HMRC at first and then decide to revert back to their usual work place full time at a later stage within the tax year, there is no obligation for the employee to inform HMRC about this occupational shift.
The homeworking claim allegation would not automatically carry over to the following tax year, but if the employee is already working at home during that time, the new claim submission will be required for the following tax year 2021/22.
Get in touch
Contact us if you have any questions or want to discuss the next steps for your business.
Sources
https://www.gov.uk/government/news/54800-customers-claim-tax-relief-for-working-from-home