Working from home

With a large proportion of the population working from home since 2020 because of the Coronavirus pandemic, a lot of you may be wondering what happens with your tax returns. Staying at home more means larger bills, so your overall costs will be greater than usual.

You may be able to claim tax relief for these additional costs if you’ve been made to work from home because of COVID 19, although you cannot claim tax relief if you choose to work from home.

What Can You Claim On?

Additional costs are defined as costs that have increased due to your being at home. They may include bills for heating, water, contents insurance, long-range phone calls and increased wifi bills. However, things like council tax, mortgage interest and rent do not count.

If you also had to buy new things for your home office, such as a better laptop or office furniture, you can claim tax relief on those as well.

How Much Can You Claim?

There are two options when submitting your claims. These are:

  1. A total sum of £6 per week from 6th April 2020 (an increase from the £4 per week in previous years) – You do not need evidence of your costs.
    The actual amount you’ve spent, if above the £6 per week. For this one, you will need to show all evidence including receipts and invoices.
  2. Your tax relief is calculated based on your tax rate. If you pay the basic rate of 20% of taxable income and claim £6 weekly tax relief, you would get £1.20 per week in tax relief.

Confused?

That’s okay. We aren’t. Our team of experienced accountants are always on top of the rule changes in HMRC and are here to provide your small business with the support it needs to make money.

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