With so many of you working from home since March Plymouth in UNISON raised the the issue of possible tax relief for members.
The advice printed below comes from Plymouth City Council but we believe will apply to all employers
If you are a tax payer, you can apply for tax relief for homeworking, if the following conditions are met:-
- the duties that the employee performs at home are substantive duties of the employment. “Substantive duties” are duties that an employee has to carry out and that represent all or part of the central duties of the employment;
- those duties cannot be performed without the use of appropriate facilities;
- no such appropriate facilities are available to the employee on the employer’s premises (or the nature of the job requires the employee to live so far from the employer’s premises that it is unreasonable to expect him or her to travel to those premises on a daily basis); and
- at no time either before or after the employment contract is drawn up is the employee able to choose between working at the employer’s premises or elsewhere.
The benefit of the tax relief depends on the taxpayer’s tax rate. If 20% taxpayer – £6 x 20% = £1.20 tax relief a week and if 40% taxpayer – £6 x 40% = £2.40 tax relief a week.
This can be submitted on the annual tax self-assessment form, or if the taxpayer does not complete a self-assessment, an HMRC form P87 can be completed. https://www.gov.uk/guidance/claim-income-tax-relief-for-your-employment-expenses-p87#claim-online.
This can be submitted online, by posting or by telephone.
If claiming for the current year, you would need to advise HMRC if the arrangement ends to cease the tax relief claim. Claims are normally made at the end of the tax year for actual costs/relief due. Claims can be backdated to the date the homeworking arrangements were formally put in place.