Am I eligible for a work from home tax rebate? | moneyfacts.co.uk

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Michael Brown

Content Writer
Published: 22/07/2022

If you were told to work from home during the pandemic you may be eligible for a work from home tax rebate.

During the pandemic, many UK workers were required to switch an office lifestyle for a work from home set-up.

Now, even after the COVID-19 restrictions have been lifted, workers can still claim a tax rebate for working from home.

The good news is that the Government has yet to indicate when this scheme will close, so you have time to get your application ready for HMRC.

What is the work from home tax rebate?

Working from home can impact your personal finances. There is heating to think of in the winter, and business calls you may make from your personal phone. This is why the Government introduced the work from home tax rebate, to help ease the cost for individuals.

How much is the tax rebate?

The exact amount you will receive depends on the rate of income tax you pay. Each claim is based on the assumption that working from home costs £6 a week, which means you will be refunded the tax you would have paid on that sum.

Basic rate taxpayers, who pay a tax rate of 20%, will then be due 20% of £6. This equates to £1.20 a week, and £62.40 for a full working year. Below we have calculated what all income tax brackets can claim.

Tax bracket

Income tax rate

Per week

Per year

Basic rate taxpayers (Those who earn between £12,571 and £50,270)

20%

£1.20

£62.40

Higher rate (Those who earn between £50,271 and £150,000)

40%

£2.40

£124.80

Additional rate (Those who earn over £150,000)

45%

£2.70

£140.40

 

The £6 a week threshold only applies to claims made after April 2020. If you worked at home before this date, then the threshold is lowered to £4 a week.

It is important to mention this because HMRC accepts claims from the past four years. If you worked from home in previous tax years you can add this tax rebate to your current claim.

What if I spend more than £6 a week?

If you spend more than £6 a week working from home you can submit an individual case to HMRC to contest the issue. If you plan on doing this, be prepared to have receipts of your transactions and other evidence to support your case.

Am I eligible?

In order to qualify for work from home tax relief from April 2020 and onwards, you will need to meet a certain set of eligibility criteria.

The key condition here is that you must have been told to work from home by your employer. In other words, you are ineligible if you work from home on a voluntary basis. Even if you cannot go into office because it is full, you cannot claim this tax relief.

Many people will be eligible to claim tax relief from the height of the pandemic. But once rules started relaxing towards the end of 2021, it may be more difficult to justify your claim.

You cannot claim this tax relief if your employer is already paying you work from home benefits.

How do I apply?

If your tax relief does not come through your employer, then you can always submit your own application on the Government’s website.

Before you do this, you should hold the following information:

  • A recent P60, payslip or UK passport.
  • Your National Insurance number (which should be found on your P60 or payslip)

Once you have this information and documentation and you have filled out a form on the Government’s website you will be asked to input the dates when you started working from home.

This is important because if you claimed for the 2020/2021 tax year you will not automatically receive a refund for the last tax year. If you need to make a claim for both tax years you will need to make separate applications on the same website.

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