Working from home expenses to claim during the pandemic

 In General

The pandemic has created additional challenges for all of us. Money is tight and, with the way we work changing, many may have to pay for additional equipment such as computers or working from home.

The good news is, if that’s the case, you could be entitled to tax relief. How much you can claim will depend on how much you have to pay and what for. If you do decide to claim money against tax, you have to make sure you understand the rules and only claim for what you’re entitled.

Working from home

If, like many employees, you’ve been told to work from home during the pandemic, you may be able to claim your extra costs.

When you work from home, additional costs can mount up. You could be paying more for heating, phone calls, electric and water and you may find yourself having to upgrade your broadband and home insurance. However, you can claim these additional expenses back as tax relief.

To qualify, your employer must have asked you to work from home, either part time or full time.

However, this does not include expenses which remain the same such as your rent and you can’t claim if you choose to work from home.

You can claim £6 a week if you can’t provide evidence of your costs. This rose from £4 per week from previous tax years. This rate varies depending on how much tax you pay. For example, if you’re in the 20% tax bracket, you’ll get £1.20 a week in tax relief (20% of £6).

Uniform or clothing

If you’ve been asked to wear a uniform or protective clothing, you may be able to claim tax relief on repair or maintenance. However, this does not include the initial purchase of the clothing.

For those being asked to wear PPE, you cannot claim this as tax relief. Your employer should either pay for the PPE upfront or reimburse you for the costs.

You can claim an agreed flat rate if you do not have receipts or the full costs if you do. You can check the agreed flat rate expenses for your job on the .gov website.

Vehicles

If you use a vehicle for work you may find yourself paying more in petrol or insurance. If this is the case, you can claim tax relief for cars, vans, motorcycles or bicycles.

This does not include any expenses spent travelling to and from work unless it’s a temporary place of work.

How much you can claim depends on whether you’re using a vehicle which you have bought or leased with your own money or a company vehicle which is owned or leased by your employer.

Obviously, if it’s the former you should be able to claim a bit more.

Tax relief will be available on the approved mileage rate which covers the costs of running the vehicles. These rates are set at:

First 10,000 miles in the tax year Each mile over 10,000 in the tax year
Cars and vans 45p 25p
Motorcycles 24p 24p
Bicycles 20p 20p

 

However, you cannot claim separately for:

  • Fuel
  • Electricity
  • Road tax
  • MOTs
  • Repairs

To work out how much you can claim you should keep records of the date and mileage of your journeys. You should calculate the total amount of mileage for all work vehicles and subtract the amount your employer pays in costs.

Using a company car

If you’re using a company car you can claim expenses for the money you spend on fuel and electricity if you keep records. If your employer only reimburses part of your travel expenses, you’ll be able to claim the difference.

Professional fees or subscriptions

Some jobs may require you to pay fees to an approved professional organisation. If so, you may be able to claim tax relief. However, this only applies if you have to be a member of an organisation to do your job.

It does not apply for life membership subscriptions, fees or other subscriptions which you do not pay yourself, such as anything paid by your employer. Equally, if you have chosen to become part of a professional organisation, but are not required to for your job, it should not apply.

If you are eligible, your organisation should be able to tell you how much you can claim back.

Travelling and overnight expenses

Thanks to lockdown, fewer of us are having to take work trips. However, if your work does require you to travel you can claim tax relief for things such as:

  • Public transport costs
  • Hotel accommodation if you have to stay overnight
  • Food and drink
  • Congestion charges and tolls
  • Parking fees
  • Business phone calls and printing costs

However, you cannot claim for the basic costs of travelling to and from work, unless it’s temporary work.

Using equipment

The annual allowance offers tax relief for any substantial equipment you have to buy, such as a specific computer or any other machinery.

This doesn’t cover smaller items such as uniform or boots. There are already accounted for under relief for uniform and tools we mentioned earlier.

You can only claim under specific circumstances, namely if you need the equipment to do your job and you do not use it for private use. This includes equipment used according to your organisation’s policy.

If your employer gives you money for some of the costs, you will reduce the amount you claim based on how much you get.

Claim what you’re entitled to

While freelancers are used to claiming back money on their expenses, people in full time employment often don’t think they qualify for any help.

However, with the pandemic shifting people into home working, many people are finding themselves having to cope with extra expenses such as upgrading their domestic broadband or kitting out a home office. If that’s the case and you’ve had to spend some of your own money, it’s important to know if you can get some of it back.

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