How to: claiming tax relief for remote workers

Did you work remotely during the pandemic? If so, you can apply for tax relief and here is how.

People who worked remotely in the time of the pandemic at least for one day can now backdate their tax relief claim of up to £125 a year. HMRC says that around 800k workers have already applied for tax relief since April. They also say that workers who return to the office are still able to apply for relief for this tax year.

According to Myrtle Lloyd from HMRC, an increasing number of workers are returning to the office and can still claim cash on household expenses provided they worked remotely amidst the pandemic.

Can you get the tax relief?

You are eligible for the full 2021/22 tax year’s £125 relief if you were told to work remotely and did so at least for one day. It does not depend on whether you have returned to the office in mid Spring or are still going to.

It is noteworthy that you are not eligible for the relief if it was your choice to work remotely or your company covered the expenses by any means.

Once you have completed your annual tax return, you can claim the relief through the Self Assessment.

Where to start?

Begin with going through some questions from HM Revenue and Customs on gov.uk to check your eligibility for the relief. You must have a Government Gateway ID with a password to proceed with your application.

If you do not have the Government Gateway user ID, you can create it in around 10 minutes with your National Insurance number and your IDs such as a UK passport, P60, or latest payslips. In case you apply for an exact amount for expenses, you will have to provide proofs as receipts, invoices, or contracts.

How much can you get?

The relief is up to £125 for this tax year. The amount of the relief is generally based on £6 per week from April 6 previous year. If there were extra expenses over the weekly amount, the relief would be made up of these exact costs, and you would need the abovementioned proof for that.

Your tax rates have a direct impact on the amount of relief you can get. For example, if your tax rate is 20% and you apply for £6 a week tax relief, you will get 20% of £6, which is £1.20 a week or £62.40 per year. The higher your tax rate is, the higher tax relief you can claim.

What can be covered?

The tax relief can only be claimed for utility bills that are related to your work, including internet, electricity, gas, or metered water.

Which way will you get the tax relief?

When your tax relief application is completed and your tax code is adjusted for the current tax year, you will get the money through your salary.

Can you backdate?

You can still apply for the tax relief even if you had to work remotely during the last tax year. Workers can backdate applications for 4 years max. and get a single payment if done correctly.

Now that you have some insights on the tax relief, why not apply for it and take your dream of buying a new home one small step further?