Tax Refunds for Working at Home
09th July 2021
The COVID-19 pandemic has changed a lot about the way the UK thinks, lives and works over the last year. One of the biggest shifts has been in how much of our work we’re doing from home. Cramped offices and tedious commutes are no longer automatically essential parts of our working days now. Across the country, major chunks of the British workforce are setting up workspaces in their own homes.
It sounds great in theory. You’re spending less time and money on needless journeys, for one thing. On the other hand, even if you’re still going into the office some of the time, you’ve probably got some considerations and expenses you never had before. There are hidden costs associated with the “home office” lifestyle, and they’re all too easy to overlook. As with many other essential work expenses, the money you’re laying out on your home office can count toward your tax refund each year.
What can I claim for Working From Home?
HMRC’s rules allow for certain types of household bills to count as “tax deductible”. This basically just means that you can claim back the tax portion of the cost as a refund at the end of the tax year. We’re talking about things like gas and electricity bills, metered water and business use of your phone.
Obviously, you won’t impress the taxman much if you try to claim your entire year’s utility bills against the tax you owe, but you can certainly include a proportion of them - and you absolutely should. Like any other necessary expense of your job, working from home shouldn’t mean paying more tax than you owe.
What are the rules for tax refunds for Working From Home?
One important thing to understand about this is that you don’t necessarily need to be working from home all year to get the tax relief. In fact, even working just one day in the year from home could qualify you for the full refund. As always, though, there’s a catch. To get the tax relief, you have to have been told by your employer that you need to work from home. Choosing to work from home when there’s an option not to won’t earn you any tax back. You also won’t get anything if your employer’s meeting all the essential costs for you.
As for claiming your working from home tax relief, you’ve got a few basic options:
- Your employer can basically give you an extra tax-free payment of £6 per week for your costs.
- Instead, you can make a “flat rate expenses” tax refund claim on £6 per week of costs. This essentially means a refund of £1.20 per week if you’re a basic rate taxpayer, or £2.40 a week on the higher rate.
- If you’ve got much more to claim for in working from home or other expenses, you can keep detailed records of what you’re spending and make a full tax refund claim based on those. This is more work, obviously, but it can be worth it if you’ve got a lot to claim for – especially if it includes work travel.
Can I claim if I still travel for work some days?
If you’re still travelling for work (not including your normal commute), then a full tax refund claim with RIFT is still your best option. You’ll get back everything you’re owed, with the UK’s top tax refund specialists handling the whole process. We'll also make sure any other money you're due such as marriage allowance, work from home allowance, etc are claimed as well as handling any other tax matters such as additional income or renting a property are taken care of as part of our service.
If you just need to claim back the flat rate for things like working from home, you could still be looking at a refund of hundreds of pounds per year. Our partners at WorkCostsR4U are experts at getting you the tax relief you’re owed for:
- Upkeep and replacement of your tools, uniform or specialised work clothes.
- Working from your home.
- Professional fees and subscriptions.
It only takes a few scraps of information to get your working from home tax refund started. Visit WorkCostsR4U to make your claim.