At the beginning of the COVID-19 pandemic in March 2020, the UK government encouraged the public to work from home where possible. This guidance was followed by some new rules on claiming tax relief, helping to combat the inevitable rise in household costs that stemmed from working from home instead of the office.
Recently, it has been announced that the rules have changed for those working from home, which will affect many people.
Below we explain the new changes to work-from-home tax relief, how to make a claim, and what the relief can be used for.
What Are The New Work From Home Tax Relief Changes?
The working from home tax relief was claimed by more than 3 million people for the 2020/21 tax year. However, as more workers have returned to the office permanently, or through hybrid working, the rules changed from April 2022. Even if you have previously made a successful claim, you might not be able to claim the deduction for the 2022/23 tax year. UK workers could claim some tax relief if working from home partially or fully in 2020 and 2021, due COVID-19.
However, from 6th April 2022, this has changed. Now, you can only make a claim if you have to work from home, not if you simply chose to. You can claim tax relief if you have to work from home, for example because:
- your job requires you to live far away from your office
- your employer does not have an office
Who Is Eligible For Work From Home Tax Relief Now?
You can only claim tax relief if you have to work from home and you’re not receiving expenses directly from your employer to cover the extra costs of working from home. You cannot claim tax relief if you choose to work from home. This includes if:
- your employment contract lets you work from home some or all of the time
- you work from home because of coronavirus (COVID-19)
- your employer has an office, but you cannot go there sometimes because it’s full
So, if you work from home simply because of COVID-19, your contract is flexible on whether you work at the office some or all of the time, or your office is sometimes full so you choose to work from home, you can’t claim work from home tax relief for the 2022/23 tax year. You can only claim for things to do with your work, such as:
- business phone calls
- gas and electricity for your work area
How Much Tax Relief Are You Entitled To?
The amount you get depends on what rate taxpayer you are. Here is what you could get:
- Basic rate taxpayer (20%) – Claim £1.20 per week or £62.40 per tax year
- Higher rate taxpayer (40%) – Claim £2.40 per week or £124.80 per tax year
- Additional rate taxpayer (45%) – Claim £2.70 per week or £140.40 per tax year
What Can You Actually Claim Tax Relief For?
You can claim working from home tax relief for things that help you do your job, such as gas and electricity, metered water, business phone calls and internet access. Potentially you can even claim on equipment you’ve bought, like computers, desks and chairs.
In order to make a claim, you may need to create your Government Gateway. If needed, you’ll need your NI number and a form of ID (e.g. P60 or valid UK passport). You’ll also need evidence like receipts and bills to hand if you’re looking to claim an exact amount for costs. Once your application has been approved, your 2022/23 tax code will be adjusted, so you’ll receive this tax relief directly through your salary.