Work From Home Taxes: How to Claim Tax Back
Whether you’re a full-time work-from-home employee or you work in a hybrid work environment, it’s important to know whether you’re entitled to tax relief. According to the Office for National Statistics or ONS, about 25.9 percent of people work from home.
As compared to the 2019 data that showed only 12.4 percent are working from home, this is a considerable increase. Because of this, many are still unaware of the tax relief they could claim.
If you’re wondering how you can claim for a tax refund, keep reading. In this article, we’ll share with you a quick guide on tax relief. Let’s take a look!
Who is Entitled to the HMRC Working From Home Tax Relief?
Because of the pandemic, many workplaces were forced to transition into the work-from-home environment. Because of this change, has resulted in employees paying more in household costs, which could make them entitled to home tax relief.
According to Myrtle Lloyd, the HMRC’s Director General for Customer Service, about half a million people have reduced their Income Tax by claiming tax relief for working from home. And with that, she has been encouraging people in the same situation to do the same.
How Much Tax Relief Can You Claim?
From April 2020, employers can pay tax-free without employees’ proof of increased bills is up to £6 a week. And employees who don’t receive the working from home expenses payment can personally apply for an HMRC tax refund directly.
In addition, eligible customers can also claim tax relief based on the rate when they pay taxes. Taxpayers who pay a high rate could receive about £2.40 a week, reducing their taxes by £62.40 or £124.80.
However, if you started working from home and did not claim for tax relief, don’t fret. This is because HMRC said they would accept backdated claims for up to 4 years, and customers will receive a lump sum payment if they’ve successfully filed their claims.
Does this Work for Part-Time Employees Who Don’t Pay Taxes but are Working From Home?
Since this is a tax rebate, a person needs to pay taxes in the tax year you are claiming. Otherwise, you are not eligible to get a tax refund. With that said, the current threshold for the current tax year is £12,570, meaning you need to earn above that amount before the claim is deducted from your salary.
The Bottom Line: It’s Worth Knowing How to Get Your Tax Back
There’s no denying that you’ve increased your expenditures ever since you’ve started working from home. But fortunately, if you’re eligible, you can get an HMRC tax refund.
If this confuses you, and you’re unaware of how you can compute your claims and taxes, you can always rely on platforms like Tax Refund Calculator to compute and estimate your taxes based on how much you spend on household costs. This way, you’ll know what to expect from your HMRC tax refund.
How Can We Help You?
Tax Refund Calculator can help you get back that’s yours by calculating whether you’ve paid too much tax or have unused uniform allowance or marriage tax allowance. Check your HMRC tax refund today!