If your job requires you to work from home, HMRC working from home tax relief lets you reduce your taxable income by £6 a week without keeping receipts, worth about £1.20 a week to a basic rate taxpayer and £2.40 a week to a higher rate taxpayer. You can claim more if your actual extra costs are higher, but you’ll need evidence. Claims can be backdated for the current tax year and the four previous ones.1GOV.UK. Claim Tax Relief for Your Job Expenses – Working From Home
Who Qualifies
The test is narrower than most people assume. You qualify only if you have to work from home because the job demands it. HMRC gives two examples: your employer has no office, or your job requires you to live too far from the workplace to commute reasonably.1GOV.UK. Claim Tax Relief for Your Job Expenses – Working From Home
You cannot claim if you simply choose to work from home. That covers contracts that allow home working some or all of the time, and days when the office happens to be full. Hybrid workers who split their week between home and office by choice don’t qualify either.1GOV.UK. Claim Tax Relief for Your Job Expenses – Working From Home
During 2020/21 and 2021/22, HMRC relaxed the rules for anyone told to work from home because of coronavirus.2GOV.UK. Working From Home – Customers May Be Eligible to Claim Tax Relief in 2021 to 2022 That relaxation ended from 2022/23. If you claimed during the pandemic and your working arrangements have since shifted, don’t assume you’re still eligible. HMRC now asks for evidence that home working is a genuine job requirement before accepting a claim.1GOV.UK. Claim Tax Relief for Your Job Expenses – Working From Home
How Much You Can Claim
The straightforward option is the £6 weekly flat rate. No receipts, no calculations. Over a full year that’s £312 of tax relief on your income.1GOV.UK. Claim Tax Relief for Your Job Expenses – Working From Home
The relief reduces your taxable income rather than your tax bill directly, so the cash saving depends on your marginal rate. A basic rate (20%) taxpayer saves about £1.20 a week, roughly £62.40 across a full year. A higher rate (40%) taxpayer saves about £2.40 a week, or £124.80 a year.2GOV.UK. Working From Home – Customers May Be Eligible to Claim Tax Relief in 2021 to 2022
Once HMRC processes your flat rate claim, they change your PAYE tax code so you pay a little less tax each pay period. There’s no lump sum unless you’re backdating.
Claiming Your Actual Costs Instead
If your extra household costs are genuinely more than £6 a week, you can claim what you’ve actually spent. The deduction can be larger, but the record-keeping is real.
HMRC’s internal guidance restricts an employee’s actual expenses claim to three things: the extra gas and electricity used while a room is being used for work, metered water attributable to work, and the cost of business telephone calls.3GOV.UK. EIM32815 – Employment Income Manual
Broadband is a common trap. HMRC says you cannot claim for anything used for both private and business purposes, and names broadband alongside rent as an example.1GOV.UK. Claim Tax Relief for Your Job Expenses – Working From Home The same applies to mortgage interest, rent, and council tax. Those apportionments are available to the self-employed under different rules, not to employees.
Your calculation must isolate the extra cost of working at home, not a share of your whole bill. If your electricity bill rises by £15 a month because you’re heating and lighting a workspace during the day, that £15 is what you claim. A reasonable approach is to compare bills from a period you worked at home with a similar period you didn’t, or to estimate the running cost of your equipment and heating during working hours.
If you claim actual costs, HMRC asks you to send supporting evidence such as receipts or bills.1GOV.UK. Claim Tax Relief for Your Job Expenses – Working From Home Keep the paperwork for at least three years from the end of the tax year the claim relates to, in line with HMRC’s general record-keeping rules.4GOV.UK. Expenses and Benefits for Employers – Record Keeping Holding records for longer is sensible, because HMRC can open enquiries further back in some circumstances.
If Your Employer Already Pays You
Your employer can pay you up to £6 a week, or £26 a month if you’re paid monthly, tax-free to cover the additional costs of homeworking. The payment is exempt from income tax and National Insurance for both sides and doesn’t need to be reported to HMRC.5GOV.UK. Expenses and Benefits – Homeworking – What to Report and Pay
If your employer pays you the full £6, you can’t also claim the flat rate from HMRC. That’s the same allowance twice. If they pay less, you can claim the difference. If they pay more, they need to be able to show the excess reflects your real additional costs, otherwise HMRC treats the unjustified part as taxable earnings that go through payroll with PAYE and Class 1 NI.5GOV.UK. Expenses and Benefits – Homeworking – What to Report and Pay
How to Claim
Online, if You Don’t File Self Assessment
If you don’t already file a Self Assessment return, the quickest route is HMRC’s dedicated online service for employment expenses. You’ll need a Government Gateway user ID and password, your National Insurance number, and your employer’s PAYE reference.1GOV.UK. Claim Tax Relief for Your Job Expenses – Working From Home
The service runs eligibility checks before you submit. Once it’s processed, HMRC issues a new tax code and your employer takes less tax off your pay from then on. For the flat rate the process is quick. For actual costs you’ll also need to send evidence of what you spent.
Through Self Assessment
If you already file a Self Assessment return, you have to claim through the return, not the online service.1GOV.UK. Claim Tax Relief for Your Job Expenses – Working From Home Working from home expenses go in Box 20, “Other expenses and capital allowances”, on the SA102 Employment supplementary pages.6HM Revenue and Customs. SA102 Employment Notes Work out your figure before you start the return.
Backdating Four Years
You can claim for the current tax year and the four previous tax years.1GOV.UK. Claim Tax Relief for Your Job Expenses – Working From Home A basic rate taxpayer backdating four full years at the flat rate would recover around £250 in overpaid tax. The online service handles backdated flat rate claims, so amended returns usually aren’t needed.
Will Claiming Affect Capital Gains Tax When You Sell?
Homeowners sometimes worry that claiming home working relief could dent Private Residence Relief when they sell. In practice, this is rarely a real problem.
PRR is only restricted where part of the home has been used exclusively for business. A room used partly for work and partly for residential purposes qualifies in full for PRR, with no restriction.7GOV.UK. CG64663 – Private Residence Relief – Non Residential Use If your home office also serves as a guest bedroom, playroom, or any space with genuine regular residential use, your full relief stands. The risk only arises with a space that has been converted into a dedicated office with no residential use at all, and even then only the gain attributable to that part of the property is in scope, with the annual exempt amount available to reduce it.8GOV.UK. Capital Gains Tax Rates and Allowances Keeping a claimed workspace in demonstrable dual use avoids the question entirely.