If I’m working from home, can I claim for additional expenses?

Category: News

In light of the COVID-19 pandemic, and the resulting social distancing and travel restrictions, more and more of us are now working from home.

Even as restrictions slowly begin to be lifted, home working looks set to continue indefinitely for some. While certain businesses are delaying their return to the office due to safety concerns, others are simply realising the benefits of working from home can often outweigh the negatives.

Social media giant Twitter informed their employees earlier in the year that they have the option to work from home forever, should they choose to. They aren’t alone; an increasing number of other companies are closing their office doors for good in favour of going full-time remote.

The reality is that the events of recent months have shown that working from home is a viable option for many and one that shouldn’t be dismissed. Let’s take a look at some of the reasons why it works.

The pros

There are a number of benefits to working from home, with perhaps the most obvious one being the time saved. It’s unlikely that many people will have missed the rush hour commute and by getting back these crucial hours during the working day it’s allowed productivity levels to soar.

The flexibility of home working is another benefit, particularly for those with childcare commitments.  Also, without the cost of travel and lunch (and the temptation of pricey coffees), it’s allowed many to reduce their average monthly spend.

The cons

Despite its attractive qualities, working from home isn’t without its drawbacks. Many people simply aren’t adequately set up for a home office environment, be it due to shared housing, lack of equipment or increased distractions. Others miss the atmosphere and team support that comes from being in an office or communal space, which can, in turn, impact their mental health.

While you might see savings elsewhere, working from home can result in a rise in utility bill costs, simply due to more time spent at home. This can be concerning, especially for those who aren’t returning to the office any time soon, if at all.

The home working tax-free allowance

There’s good news if you’re one of the people who’ve noticed creeping household costs since working at home. You can claim a weekly (or monthly) tax-free allowance to help cover the additional costs incurred by working from home.

Even better news is that for the 2020/21 tax year, this allowance has increased from £4 a week to £6 for weekly paid employees, and from £18 a month to £26 for monthly paid employees. In isolation, this might not seem like a massive amount, but it soon adds up – and an additional £312 a year is certainly not to be sniffed at.

This tax-free allowance covers any additional costs to your:

  • Heating bills
  • Electricity bills
  • Metered water bills

It’s something that’s actually been around since 2011, but the claims process used to be far more complex and strict. In addition to having to provide evidence to justify your expenditure, you would also have to prove:

  • That your duties performed constitute those of employment
  • That you can’t perform your duties without the use of appropriate facilities
  • That appropriate facilities aren’t available to you on your employer’s premises

Put simply, it was a hassle. However, in light of this year’s unprecedented events, the conditions have been relaxed for the current tax year, meaning a welcome relief to those who find themselves working from home indefinitely.

You’ll only be able to claim for things directly associated with your work. Costs that would have remained the same regardless of where you were working, such as mortgages, rent and council tax can’t be claimed for.

You can check if you’re eligible for the tax-free allowance here.

How to claim it

If you fall into the category of people who are eligible for the flat rate (up to £6/wk) home working allowance, it’s easy to claim directly from HMRC. You can do it on the phone, online or via post, and you won’t need to show proof of your expenditure. More information on making a claim can be found on the gov.uk website.

If you’re looking to claim more than the standard rate, you’ll need to provide receipts and records of your expenses.

Claiming for office kit

Many workers have also found themselves in need of additional office kit for their home set-up, such as desks, monitors and laptops. If you’ve had to buy this equipment yourself, your employer can now reimburse your costs tax-free.

You’ll have to show that the equipment was provided to enable you to work from home during the coronavirus pandemic and that any personal use of the equipment has been minimal.



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