Working from Home Tax Relief: A Simple Guide

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working from home tx relief

Today, we’re going to talk about something that might be very useful for you. It’s called “Working from Home Tax Relief”.

Have you ever noticed that when you work from home, you might use more electricity or your phone more often? The good news is, you might be able to get some of that money back. This is what “Working from Home Tax Relief” is all about.

In this article, we will explain what this tax relief is, who can claim it, and how you can do it. We will use very simple terms, so do not worry if you are not a tax expert. Let us get started:

What is Working from Home Tax Relief?

When you work from home, you might have to spend extra money on things like electricity, heating, or phone calls for your job. The good news is that you might be able to get some of that money back. This is called “Working from Home Tax Relief.”

Types of expenses

When you are working from home, there are several types of expenses that you might be able to claim for tax relief. Here are some of them:

  • Business Phone Calls: If you are making calls for your work, you can claim these costs.
  •  Gas and Electricity: If you have a specific area in your home for work, you can claim the cost of gas and electricity for that area.
  •  Office Equipment: This includes things like laptops, printers, and other computer equipment.
  •  Internet Connection: If you need the internet for your work, you can claim this cost.
  •  Office Furniture: If you have had to buy a desk or a chair for your work, you can claim these costs.
  •  Home Office Space: If you’ve dedicated a specific area in your home for work, you can claim the cost of this space.
  •  Heating and Lighting: The costs of heating and lighting your work area can also be claimed.

Who Can Claim this Tax Relief?

You can claim this tax relief if you have to work from home because of your job. For example, if your job needs you to live far away from your office, or if your employer does not have an office. But, if you choose to work from home, you cannot claim this tax relief.

What Can You Claim For?

You can only claim for things that are related to your work. For example, you can claim for work phone calls or for the electricity and gas in your work area. But, you cannot claim for things that you use for both private and business use, like rent or broadband access.

How Much Can You Claim?

You can claim tax relief on £6 a week from 6 April 2020. You do not need to keep evidence of your extra costs for this. If your extra costs are more than £6 a week, you can claim for the exact amount. However, you will need evidence like receipts, bills, or contracts.

The money you save on taxes is based on how much tax you pay. For instance, if your tax rate is 20% and you get a tax break on £6 every week, you would save £1.20 each week on taxes.

How to Claim?

You can claim for this tax year and the 4 previous tax years. You can check if you can claim and make a claim if you are eligible on the GOV.UK website. Once your application has been approved, tax code will be changed for the 2021 to 2022 tax year. You will receive the tax relief directly through your salary until March 2022.

You have not missed out if you were required to work from home but did not claim tax relief. HMRC will accept past claims for up to 4 years. You will receive a lump sum payment for backdated claims.

Conclusion

Working from home can come with extra costs, but the Working from Home Tax Relief can help you manage these expenses. Remember to check if you are eligible and do not forget to claim your tax relief.

Some Questions

What is Home Tax Relief? 

Home Tax Relief is a way for people who work from home to get some of their money back. They can claim extra costs like electricity, heating, or phone calls that they had to pay because of their job.

Who can claim Home Tax Relief? 

If you have to work from home because of your job, you can claim this tax relief. However, if you choose to work from home, you cannot.

What expenses can I claim for Home Tax Relief? 

You can claim for things that are related to your work. For example, business phone calls or the gas and electricity for your work area.

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