IF you had to work from home at any point because of coronavirus you could be due hundreds of pounds back according to Martin Lewis.
Even if you only worked from home for a day you could be due a whole years tax relief.
You’ll have needed to work from home at any one point in the previous two financial years to still be eligible to claim up to £280.
Martin said: “If you had to work from home, even for a day, from April 6, 2020 to April 5, 2022 and haven’t claimed tax relief, then you can still claim.”
“The same is true if you only claimed for one year, but were eligible for the other. It’s simple to do for more, though there’s a separate route if you fill in a self-assessment tax form.”
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What is work from home tax relief?
You can get up to £180 per year in tax back if you have been told to work from home by your employer, even for just one day.
Claims can also be made for the previous tax year, also worth up to £140, so anyone who’s eligible for both years and hasn’t yet claimed can get you roughly £280 according to MoneySavingExpert.com.
HMRC will, in fact, accept backdated claims for up to four years which means in total you could claim up to £500.
Under the scheme, your tax code is adjusted so you’re not paying as much tax.
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Claims for last year are paid as one lump sum in your salary while ongoing claims for this year will be factored into your monthly wage.
The scheme is designed to help people cover the extra costs of working from home, like energy bills and internet connections.
However, the rules for claiming in the 2022/23 tax year have change and you’ll only be eligible if:
- There are no appropriate facilities available for them to perform their job on their employer’s premises.
- The nature of the job requires them to live so far from the employer’s premises that it is unreasonable for them to travel to those premises on a daily basis.
- They are required, under government restrictions, to work from home.
If I chose to work from home am I eligible?
No. If you worked from home on the back of your own decisions you won’t be eligible for tax relief.
Crucially, your employer must have required or asked you to work from home for you to be able to claim tax relief.
To be eligible, you will also have to have seen your household costs rise because of working from home.
This could be because you’ve had the lights or heating on more because you’re inside for longer, or you’ve used more internet than usual.
But you won’t be able to claim the tax back if your employer is covering your working from home expenses already.
How much can I get back?
Your employer can effectively pay you £6 a week extra tax-free cash to cover expenses.
But it’s more likely you’ll instead claim tax relief on this £6 a week.
If you claim the tax relief, the exact reduction to your tax bill depends on your tax rate and it’s the highest rate of tax you pay that’s used.
For those paying the standard tax rate of 20%, you would get £1.20 a week in tax relief.
While for people who pay tax at the higher rate of 40%, you’d get £2.40 a week.
Additional rate tax payers who pay 45% will get £2.70 a week.
So claim for the entire tax year, that’s tax relief of £62.40 for basic rate taxpayers, £124.80 for higher rate tax payers, and £140.40 for additional rate tax payers.
How do I claim the cash?
HMRC has an online tool to help you submit a claim for both tax years.
If you’re back-dating claims for the 2020 and 2021 financial years, you’ll get he money as a lump sum through your salary.
You’ll need several documents to hand in order to claim tax back.
- Something to prove your identity – this could be a passport, driving licence, or you can answer various questions based on your credit file
- A P60 or recent payslip
- National insurance number
- Your Government Gateway user ID and password or you can create a user ID if you do not already have one.
Check your tax code if you’re no longer eligible
If you previously made a claim for tax relief during the pandemic it’s worth checking if your tax code is up-to-date today.
For non back-dated claims your tax code for the 2020 and 2021 tax years would have be adjusted automatically.
You would have then seen the tax relief directly through your salary.
Your tax code determines how much income tax your pay on your earnings – so it’s important you’re on the right one.
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If you’re still on the code set when you applied and got accepted for tax relief the chances are, you’ll be under paying your tax and could owe HMRC money in the future.
Check if your tax code is correct by using HMRC’s online tool now.