Home working utility expenses claim amount increased

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With the current Coronavirus crisis meaning that a lot of people are now working from home, HMRC has made the decision to allow employees to claim a flat-rate deduction of £6 ​per week that they work at home in order to cover additional household utility costs incurred as a result of this. 

On 6 April 2020 the standard rate of this allowance was raised from £4 to £6 per week (from £18 to £26 per month). Previously, since April 2011 employers have been able to pay their employees a tax-free allowance to cover the additional costs incurred when an employee works at home on a regular basis under ​arranged home working ​agreement. 

The employee does not have to keep any records of costs or provide any evidence to their employer of the extra expenses they incur by working at home. However, if more than the flat rate is paid by the employer, the employee will have to demonstrate how their additional costs exceed the flat rate.

This allowance only applies to amounts paid by the employer to the employee.

Employees can claim via the self-assessment returns or via form P87 (online or by post) or by ringing HMRC on 03000 200 3300. 

You can find out further details on the HMRC website page on this change.