Ever since the start of the coronavirus pandemic, there has been a significant increase in people looking at making tax relief claims due to the additional costs incurred for working from home.
If you work from home, you may be able to claim tax relief for working from home on additional expenses like heating, electricity, work-related phone calls.
Who can claim, and what can you claim depends on a lot of things. Check our Creative Takeaways section for quick answers, then read on to get the details.
Creative Takeaways
- Tax relief – Claim extra home costs.
- Flat rate – £6 per week.
- Eligibility – Must be required to work from home.
- Expenses – Phone calls, utilities for work area.
- Claim process – Flat rate or exact costs with proof.
Table of contents
1. What is the working from home tax relief?
The working from home tax relief method was introduced by HMRC in 2003 as a way to help employees cover additional household costs when working remotely.
Employees could claim a flat rate of £4 per week without needing to provide receipts.
In April 2020, HMRC increased the flat rate to £6 per week to accommodate the surge in home-based working during the COVID–19 pandemic.
From April 2022 onwards, HMRC reverted to stricter eligibility rules, and those require the employees to prove that working from home was a necessity rather than a choice.
2. Are you eligible for working from home tax relief?
You must meet specific eligibility criteria to be able to claim tax relief for working from home.
The Government has a dedicated page named tax relief for employees working at home that you can check anytime. However, we can also guide you through this simple checklist:
Who can claim tax relief for working from home
To be able to claim this tax relief, you must be required to work from home by your employer. This means:
- Your employer doesn’t have an office space for you to work from.
- You must work from home regularly, not just occasionally.
- You incur extra costs (e.g., heating, electricity, phone calls).
If you’re self-employed, you don’t need employer approval – you can claim part of your home expenses as a business cost in your Self-Assessment tax return.
| Creative Tips You can claim tax relief for working from home even as a limited company. Since you are both the director and an employee of your company, you can claim a flat rate of £6 per week. |
Who cannot claim tax relief working from home
You’re not eligible for work for home tax relief if you choose to work from home for personal reasons:
- You stay at home because you want to avoid commuting.
- If your employer allows hybrid working but provides an office space, you’re not eligible for the claim.
BUT!
If your job requires you to work both from home and the office, you can claim up to £6 per week to help cover extra home working costs like heating, electricity, and internet costs.
3. What you can claim for working from home?
HMRC has strict rules about what qualifies as a specific expense related to your job. You can only claim for work-related costs, and not personal expenses.
Business phone calls & work-related communication
- Costs for business-related phone calls on your landline or mobile.
- If you use your personal phone, you can only claim the portion used for work (e.g., itemised call records).
- If you have a separate business phone or contract, the full cost is allowable.
Gas & electricity for your work area only
If working from home increases your utility bills, you can claim the business proportion of extra expenses for:
- Heating (gas, electricity, or oil costs for the room you work in).
- Lighting (for your dedicated workspace).
- Power (if you use electrical equipment for work, such as a computer).
4. How to claim for tax relief if you’re working from home
If you’ve checked some or all of the boxes, and you’re eligible for working from home tax relief, you can claim it through HMRC’s dedicated page.
It all depends on what you want to claim. Either way, during the process, you have to send evidence that you have to work from home. Depending on you’re home office setup, you can claim:
- £6 a week for the tax year OR
- the exact amount you’ve spent.
You can opt-in for the second option without a problem, but keep in mind, that you will have to send evidence for the exact amount you’ve spent. This means that you need to keep your copy of your receipts or bills.
5. Claim eligible expenses with our help
Are you ready to save money on your tax bill? Working from home could be your ticket, but let’s face it – those tax rules aren’t exactly light reading.
Why struggle through the paperwork alone?
Our experts are just a phone call away – and it won’t cost you a penny. You focus on what you’re great at. We’ll focus on putting money back in your pocket.
Reach out now and let’s make those home office expenses work for you!
