Working from Home Expenses for Employees in 2020/21

The recent crisis has meant that many have been required to work from home leading to increased expenses. 

Where these expenses are a result of forced office closures and not voluntarily vacating your workplace many of the expenses incurred can be offset against your employment income for tax relief.

You can only claim for expenses related to your work, for example, the additional gas and electricity or cost of business calls.

A sensible way to keep a track of these costs is to compare expenses from a previous year prior to working from home with your current charges. The difference can then be claimed against your taxable income.

Alternatively, there is a flat rate expense that can be claimed which is £6 a week.   In prior years the flat rate could be claimed for each week you work from home however for the tax year ended 5 April 2021 you can claim the full year if you have been forced to work from home at all, which means £312 is claimable in total.

You will also be able to claim tax relief on any equipment you have had to buy such as a laptop, desk or chair as long as it’s primarily for work and there is no significant private use. If your employer provides equipment but you decide to purchase an alternative, this expense cannot be claimed.  Any contribution towards the equipment by your employer will reduce the claimable amount. For example, if you buy a £500 laptop to which your employer contributed £200 you can only claim £300 as an expense. This means that any expenses fully reimbursed are not claimable.

Claims can be made through your self-assessment tax return or online through your government gateway account using a form P87.

Your employer can pay you up to £6 a week to cover your additional expenses if you have to work from home with no tax consequences on you.

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