A useful guide for employers and employees working from home due to coronavirus. See what support is available and what you can claim in expenses.
What support can I get whilst working from home as an employee?
Employees, who are required to work from home due to COVID-19 due to self isolation or if a workplace has closed, may incur additional costs working from home.
An employer may or may not decide to reimburse costs to an employee. If an employee does not get support from an employer, some tax relief may be claimed directly from HMRC.
What if I choose to work from home as an employee but my place of work is still open?
Employees who work from home by choice are treated differently.
In this instance, you cannot claim tax relief from HMRC if your employer decides not to reimburse you for your expenses.
When home-working expenses are reimbursed by employers, the tax treatment will depend on the nature of the expense.
What expenses can I claim as an employee whilst working from home?
In some cases, employees who can demonstrate that they have met certain conditions, can claim a proportion of certain household expenses from their employer, if the employer agrees.
The expenses that can be claimed must wholly, exclusively and necessarily relate to your employment. You cannot therefore claim for home running costs as there is a personal element to the charges.
Alternatively, you can claim a flat rate Home Working Allowance of £6 per week from 6 April 2020 (previously £4 per week up to 5 April 2020) which can be paid to employees for additional household expenses incurred while working from home and is tax-free.
There are some expenses reimbursed to an employee that are taxable. These includes reimbursement for office equipment purchased and hotel expenses for those employees who cannot self-isolate at home.
How does an employee claim tax relief from HMRC?
If an employee is obliged by the government advice to work from home and has incurred home-working expenses but has not been reimbursed by their employer, the employee may claim a deduction on their tax return.
If the employee is not required to file a tax return for the tax year to which the home-working expenses relate, a claim for tax relief can be made to HMRC by completing and submitting Form P87.
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Written Shaima Todd.