Do you work from home and are unsure about what tax relief you can claim for your expenses and how to go about it? Find out more by reading the article below.

What is it?

If an employee works from home, they can claim tax relief for the extra costs that are incurred as a result of working from home. This can include the cost of making phone calls from the landline, the costs of electricity and gas to heat and light the workspace, power the computer, and the cost of cleaning the workspace.

What are the rules?

The rules on claiming tax relief for employment are strict. Relief is only available for expenses that are incurred exclusively in the performance of the duties of the employment.

Tax relief is not available for expenses that have both a work and private element. For example, the cost of broadband, which is used for both family and work use.

There will be no reduction for rent unless a room was used exclusively for work. This would then lead to a proportionate amount that can be claimed.

Are you eligible?

If you are voluntarily working at home, rather than being required to by your employer then you will not be eligible to claim tax relief for additional expenses as a result of working from home.

The law states that employees should be working from home because of the duties of their employment demanding it, rather than a personal choice.

Although, if the employee’s contract requires that the employee works from home, part time or on specific days or when required to by the needs of the job, then tax relief will be accessible.

How do I claim my expenses?

Many employees can claim the additional costs of working from home from their employer.

If the employee’s expenses are eligible for tax relief, then the tax exemption for paid and reimbursed expenses comes into play and the employer and employee can both ignore the reimbursement for tax purposes – there is no tax to pay and nothing to report.

Keep it simple

Employers can pay a tax-free allowance of £4 per week to employees who work from home to avoid the need to keep records and work out the additional costs from working at home.

This amount is the same regardless of whether the employee works at home one day per week or five days a week.
It may be possible to pay a higher amount if this it is agreed with HMRC.

Overall, it is important that you understand the terms to claim tax relief for your expenses when working from home. If you need any more advice then please contact us.

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Any questions?
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