Martin Lewis: Worked from home due to coronavirus before 6 April 2022? You can still claim tax relief worth up to £280
If your employer requires you to work from home, you've always been able to claim for increased costs, eg, heat or electricity, for the specific time at home. Yet in October 2020, HM Revenue & Customs (HMRC) launched a 'microservice' which, even if you only needed to work from home for a day, allowed you to get a WHOLE YEAR'S tax relief.
That special relief applied for both the 2020/21 AND 2021/22 tax years – meaning many are due TWO years' worth, which can translate to up to £280 in your pocket.
Since I first got tipped off about the microservice, I've pushed hard to make people aware, both here and on my TV show – and that push worked, with substantially more than four million people claiming. But many more could be missing out.
So, if you had to work from home, even for a day, from 6 April 2020 to 5 April 2022 and haven't claimed, then YOU CAN STILL CLAIM.
Jump below to read if you're eligible.
The same's true if you only claimed for one year, but were eligible for the other. It's simple to do for most, though there's a separate route if you do a self-assessment tax form.
Working-from-home relief rules are much stricter now (for 2022/23 tax year)
While you can still claim for the prior two tax years, for this tax year – the one that started 6 April 2022 (and likely for future tax-years) – HMRC says you can't claim tax relief if the only reason you're required to work from home is coronavirus, even if it's because you've tested positive.
Nor are you eligible if you choose to work from home for part of the week because your employer offers 'hybrid working' – even if this is written into your employment contract.
This means you are only eligible if…
- Your employer doesn't have the facilities you need for your job on its premises (for example, there's no office at all).
- The nature of your job requires you to live so far from your employer's premises that you can't reasonably be expected to travel there daily (for example, you're an area manager for north east England but the only office is in London).
If this applies to you – which it won't for most – you can claim using the Gov.uk microservice for the whole year. The rest of the information below (barring eligibility info) will help you through it.
Did you claim for 2020/21 or 2021/22 but are no longer eligible? Check your tax code to ensure the relief hasn't been mistakenly carried over. If it has, contact HMRC.
During the pandemic many firms had to close workplaces, sometimes several times, meaning millions of UK staff were required to work from home temporarily, even if just for part of the week.
For the 2020/21 and 2021/22 tax years, HMRC specifically confirmed that claims from employees working at home due to coronavirus measures, if their usual workplace was closed, were eligible for tax relief.
The same also applied if you had to work from home because you were told to self-isolate by NHS Test and Trace, or because you were self-isolating having been pinged by the NHS app.
If you didn't claim the tax relief, but did work from home, you can still do it now, as you can back-claim up to four years (though it's tricky to claim back before 2020, as the criteria were much stricter, and you could only claim for individual days).
And if you're thinking: "I won't claim as I don't feel I deserve it", why not claim and donate it to a charity that helps those struggling at this time?
For most people, £6-a-week 'costs' is the golden figure
To claim the tax relief you must have had, and declare that you had, specific extra costs due to working from home. Yet apportioning extra costs, such as heating and electricity, is tough. Due to that, there is essentially a flat rate of £6 a week available to you. There are two ways to do this:
- Employers could have paid you £6 a week extra tax-free. Employers could've given you an allowance up to this amount, free from tax, so you get it all (to give you more, it would've had to make special arrangements).
But as many firms were struggling, they didn't do this (and didn't have to), so instead you can...
- Claim tax relief on £6 a week. If your employer didn't pay expenses for your extra costs due to necessary working from home, but you did have them, you can ask for the amount to be deducted from your taxable income.
To make the process easy, HMRC says that for claims in line with the employers' payment (ie, £6 a week), you won't need to justify that figure – meaning you won't need to keep receipts or prove information.
Tax relief of £6 a week equates to a GAIN of…
- £1.20 a week for a basic 20% rate taxpayer (£62.40 a year)
- £2.40 a week for a higher 40% rate taxpayer (£124.80 a year)
- £2.70 a week for a top 45% rate taxpayer (£140.40 a year)
- What if you had more than £6/week increased costs? If you believe you had higher costs, you can claim more, but you will need evidence of the cost increases and must be able to apportion these extra costs specifically to the fact you are working from home – a much more laborious process.
If you prefer to watch rather than read, here's a clip from my ITV The Martin Lewis Money Show from October 2020. It's out of date now but explains the basics… You can turn on subtitles by using the closed captions icon in the bottom right.
How to claim TWO years' relief (or an extra one if you've already claimed)
In October 2020, the Government created the working-from-home microservice to help people claim tax relief in the pandemic. Within this the rules changed, so that if you have to work from home, even for a day, you automatically get given the relief for ALL of the tax year at the £6/week relief rate.
You can still use that microservice now to process claims for the 2020/21 and 2021/22 tax years (though this doesn't apply if you do self-assessment via a form). This will require you to have a Government Gateway ID. If you don't have one, you can set one up along the way.
Once you're in, just select the 'previous tax years' option when you reach this page:
As your claim is backdated, you'll be paid the full amount for these past tax years by cheque or bank transfer.
If you previously claimed for 2020/21, you had to claim AGAIN for 2021/22 – it didn't carry over automatically. If you didn't, follow the same process via the microservice to get the extra year.
You'll also be asked if you're claiming any other work-related expenses. So if you wear a uniform to work, do read about the uniform tax rebate as you may be able to claim that too.
I still get swamped with messages from people who can't believe how quick and easy this process is.
If a couple both work from home, can they both claim it?
The working-from-home tax relief is an individual benefit. So if you had an increase in costs because you were required to work from home, you can claim it.
If two or more of you live in the same property, and you were all required to work from home and it's fair to say that costs had increased specifically from each individual working from home, you can all claim it.
If you do self-assessment via a form, you can't use the microservice – but ARE due the past years' relief
Those who are employed but do their tax via self-assessment each year (usually those with higher incomes or more complicated tax affairs) can claim the allowance when filling in their self-assessment form:
For the 2021/22 tax year:
- Online returns: Fill in the box titled 'Other expenses and capital allowances' in the employment section. If you've already filed your return for the 2021/22 tax year, you can go back online and amend this section to include the working-from-home tax relief. You have until 31 January 2024 to make your amendments.
- 2021/22 paper returns: It's included in section 20 on the full return and section 2.5 on the short form. If you've already filed the paper return, you can download a new tax return, and send HMRC the corrected pages with 'amendment' written on each page.
For the previous 2020/21 tax year, you have until 31 January 2023 to make the changes. After that, you can still claim (till April 2025) but will have to write to HMRC to tell it why. More details on how to correct your self-assessment is on the Gov.uk page.
And don't worry, HMRC has confirmed to us that for the 2020/21 and 2021/22 tax years, when you fill in the form you will be able to claim for the entire years automatically, in the same way as those using the microservice.
As I know some accountants will want to see that claiming for the whole year is kosher, to help I asked HMRC for an attributable direct quote on this. Here it is...
HMRC says: "We recognise that ongoing lockdown restrictions mean that many employees are still required to work from home for some or all of the time. Therefore, we're accepting claims for the full year's expenses for the 20/21 and 21/22 tax years for employees who are eligible. This includes customers claiming through self-assessment."
Do feed back on how this has worked for you below. I'd love to hear.