Working from home tax relief: how to claim government rebate from HMRC - and who is eligible in the UK?

Working arrangements have changed for many people during the Covid pandemic.

At the height of the first lockdown in 2020, nearly half of all adults in employment across the UK were working from home according to the Office for National Statistics (ONS).

It’s clear working from home has its benefits, including cutting out the commute to the office, but it also comes with extra costs such as increased heating and electricity bills.

This cost can be offset through a government scheme which allows employees to claim some money back on working from home expenses incurred during the coronavirus pandemic.

Here’s how and who is eligible for the tax relief from HMRC

Who is eligible for working from home tax relief?

Anyone who has been asked to work from home by their employers during the Covid pandemic can make a claim for some additional tax relief from the government.

The scheme covers full time, part time and flexible working arrangements for workers who have been told to work from home as part of the national effort to suppress the virus.

Anyone who has been asked to work from home by their employer, even if it’s just one day, can apply for tax relief in the 2020/21 and 2021/22 financial years.

Workers can not claim tax relief if they opt to work from home.

The relief is not for people who complete self assessment returns as there is a different way of claiming for extra costs through the government’s self assessment system.

How much can be claimed through the working from home tax relief?

The maximum amount that can be claimed is £125 per year, meaning over the two tax years a UK employee could be entitled to £250 through the government’s scheme.

This amount is dependent on what tax rate an employee pays.

There are two ways of claiming tax relief - either on the assumed £6 a week, or by supplying evidence on how much additional cost has been incurred during this time.

Basic rate taxpayers can receive 20% of the £6, which works out at £1.20 a week or £60 a year through the working from home tax relief scheme.

Higher rate taxpayers can receive 40% of the £6, which works out at £2.40 a week or £125 a year through the working from home tax relief scheme.

How to claim the working from home tax relief from UK government

UK workers can make a claim for a tax relief on working from home costs through the government’s dedicated website.

Before making a claim, workers will need to set up a Government Gateway User ID which is required to enter the online portal, alongside a password.

To create a User ID through the HMRC website workers will need their National Insurance number and a recent payslip, P60 or valid passport.

The relief covers additional costs incurred for working from home during the pandemic, such as heating, water, electricity, contents insurance, business calls and broadband.

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