A tax break for people working from home is being reviewed, it has been reported.
The rule means people who work from home even one day can claim up to £125 in tax relief, The Telegraph reports.
The idea of the tax break was to help workers with extra costs linked to internet and energy costs and it was extended during the pandemic when people were told to work from home if they could.
This meant workers were told they could claim the whole yearly sum, even if they had been told to work at home for one day.
The Telegraph reported that Chancellor Rishi Sunak is to be given a report from HMRC that could see changes to eligibility criteria.
It quoted a Treasury source saying: “This is a tax relief that existed before Covid and it was there for legitimate reasons, but the take-up is now much higher so it needs to be looked at.”
Conservative MP Kevin Hollinrake, a member of the Commons Treasury Committee, was quoted in The Telegraph as saying: “It’s important that we get people back to workplaces, rather than giving them any incentive to work from home. "
An HMRC spokesman said: “Tax relief for working from home is there to help people with the additional household costs of having to work from home. It has been a key form of government support for millions of workers during the pandemic.”
Birmingham Live has reported how to claim the tax relief and how it works
Covid-19: How much tax relief can I get if I’m still working from home?
At the moment, employees can get up to £125 in the tax year from the Government. Since the last tax year, this full amount is made up of £6 a week.
That works out at £1.20 a week for lower rate taxpayers, and a saving of £62.40 a year, and £2.40 for higher rate taxpayers, working out at a £124.80 saving for that year.
If you have specific expenses you want to claim on, you will need to provide HMRC with specific evidence, such as receipts, invoices or bills.
Employees can get the full entitlement even if they’ve only worked from home for one day since the pandemic began.
Covid-19: Can you get tax relief for working from home in previous years?
The good news is that payments can be backdated. And HMRC have rules in place for this.
If you worked from home in the past four years, you can get a backdated payment, meaning if you didn’t submit a claim last year, it’s not too late to still get some cash.
HMRC says: “If employees were required to work from home during the 2020 to 2021 tax year but did not claim for the tax relief, they have not missed out; HMRC will accept backdated claims for up to 4 years. They will receive a lump sum payment for any successful backdated claims.”
Covid-19: How do I claim tax relief from working from home?
It’s free and easy to make a claim for tax relief if you have worked from home over the past year because of the coronavirus pandemic.
