Working from home? Folk in Orkney may be eligible to claim tax relief in 2021/22

The Council is encouraging those who are working from home due to COVID-19 to check if they are eligible for HM Revenue and Customs tax relief for 2021/22.

If employed workers were told to work at home by their employer because of coronavirus and, as a result, their household costs have increased, they are eligible to claim the working from home tax relief. It is quick and easy to claim via HMRC’s online portal.

HMRC received more than three million claims across the UK for the tax relief for the 2020/21 tax year.

The Council’s Interim Executive Director of Finance, Regulatory, Marine and Transportation Services, Gareth Waterson, said that many people have already reduced their Income Tax this year by up to £125 by claiming tax relief on their working from home expenses.

He added: “We want everyone who’s eligible to benefit, so we would encourage all those working at home as a result of the pandemic to apply. Check if you’re eligible and apply at GOV.UK by searching ‘working from home tax relief’.”

From 6 April 2020, the amount employers have been able to pay tax-free without employees having to provide evidence of an increased bill is up to £6 a week. Employees who have not received the working from home expenses payment direct from their employer can apply to receive the tax relief from HMRC.

Eligible customers can claim tax relief based on the rate at which they pay tax. For example, if an employed worker in Scotland pays the 21% intermediate rate of tax and claims tax relief on £6 a week, they would receive £1.26 a week in tax relief (21% of £6 a week) towards the cost of their household bills. Higher rate taxpayers would therefore receive £2.46 a week (41% of £6 a week). Over the course of the year, this could mean customers can reduce the tax they pay by £65.52 or £127.92 respectively.

Taxpayers can check if they are eligible via GOV.UK.

To claim for tax relief for working from home, employees can apply directly via GOV.UK for free. Once their application has been approved, the online portal will adjust their tax code for the 2021/22 tax year. They will receive the tax relief directly through their salary until March 2022.

If employees were required to work from home last year but did not claim for the tax relief, they have not missed out; HMRC will accept backdated claims for up to four years. They will receive a lump sum payment for any successful backdated claims.

Using an agent to apply for the working from home tax relief, and other similar schemes, could result in customers paying unnecessary fees or commission. Using the GOV.UK service is quick and free, and customers will receive 100% of the tax relief that is due. Agents will not be able to use the online portal to apply for the relief on a customer’s behalf.