HMRC’s working from home warning

THE HMRC has issued a warning that the amended rules for claiming working from home tax relief have come to an end.

Government instructions to work from home where possible, including the legal requirement to self-isolate, meant that in tax years 2020-2021 and 2021-2022 millions of people were eligible to claim tax relief on additional household costs incurred due to working from home.

The rules around the eligibility of the tax relief remain unchanged. But the lifting of pandemic restrictions means that most will no longer be eligible to claim from April 2022.

HMRC says: “You may be able to claim tax relief for additional household costs if you have to work at home on a regular basis, either for all or part of the week. This includes if you have to work from home because of coronavirus (Covid-19).”

However, it adds: “You cannot claim tax relief if you choose to work from home.”

You may be able to claim tax relief for: gas and electricity, metered water, business phone calls, including dial-up internet access.

You cannot claim for the whole bill, just the part that relates to your work.

The new guidance adds: “You can claim if your employer has not already paid your expenses and you have additional household costs as a result of working from home.”

To claim for the new tax year 2022/23, one of the following must also apply:

• There are no appropriate facilities available for you to perform your job on your employer’s premises
• The nature of the job requires you to live so far from the employer’s premises that it is unreasonable for you to travel to those premises on a daily basis
• you are required, under government restrictions, to work from home

Employers can still choose to reimburse employees for reasonable additional household expenses that the employee incurred while carrying out employment duties at home under homeworking arrangements.

Where employers choose to make a payment to employees, employees cannot also claim from HMRC through its online service.

This is unless employer payments are below £6 per week. In this case employees can claim the difference, providing all other eligibility requirements are met.

• To discuss any tax queries you may have please contact me on 01772 480000