COVID-19 update – 12 April – Working from home tax relief

Any employee that is working from home due to COVID-19 can continue to claim tax relief on costs not reimbursed by their employer, but a new claim will need to be made for the 2021/22 tax year.

Ordinarily, employers can pay a tax-free allowance of up to £6 per week/£26 per month to employees required to work from home. During the coronavirus pandemic, when employers do not reimburse costs employees can claim tax relief for this amount to cover additional costs incurred when working from home, such as heating and lighting.

The maximum amount reimbursed on which tax relief is allowed is £4 per week up to 5 April 2020 and £6 per week thereafter. Alternatively, employers can reimburse actual costs, subject to the employee being able to provide evidence of the amounts incurred, such as phone bills.

However, a relaxation was announced on 27 March 2020 which enabled employees working from home because of COVID-19 to claim tax relief where they have not been reimbursed by their employer.

Claims that were made in the 2020/21 tax year will not be automatically rolled forward. If you are still working from home a new claim will need to be made for the 2021/22 tax year.

It is understood that once the pandemic is over, the rules will revert to their previous position.

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