HMRC Home Working Tax Relief

sophieg27

Hi,

After some advice, I recently found out that I could claim Tax Relief for working from home, I am employed but could no longer work from my local office so my contract was changed to Home Based around 6 or 7 years ago. I opted to make a claim but as I haven't kept records input the maximum allowed of £208 for the year 2015/2016 without having kept records.

I recently received a letter from HMRC to say I had paid too much tax but only received £40.28 as opposed to the £208 I was expecting, is there a reason they would percentage this? I was home based for the full year but I am wondering if I should have put a higher value in the Expenses accrued field as it's around 20% of the value I entered?

Has anyone experienced this? I decided to do only one year for now in case I got it wrong (as I seem to have done!) so need to do the remaining years up to now.

Any help / advice appreciated

parkrunner

Maybe the £208 is an allowance which is added on to your personal allowance, if so the the overpayment would have been £41.60 assuming 20% income tax. You also may get better advice here,

https://forums.moneysavingexpert.com/forumdisplay.php?f=22

calcotti

Think park runner is spot on. If you have expenses these do not get reimbursed by HMRC but they do reduce your taxable earnings. The tax due back for a basic rate tax payer is 20% of the expenses.

sophieg27

Thanks both, I thought it might be something like this - HMRC say they will pay back £208 in yearly refunds (without having to provide the evidence) so perhaps I need to be raising the amount I'm adding into the expenses accrued to cover this - I don't have records for that far back but it's supposed to cover things like heating, gas, electric used etc.

calcotti

If this https://www.gov.uk/simpler-income-tax-simplified-expenses/working-from-home is the scheme you are referring to then the £208 looks to be the allowable expense, not the refund due, as per previous replies.

CakeCrusader

I work from home and receive this, it's via an adjustment in my tax code. My employer refunds my broadband separately (so I don't claim for this, just £18 a month gas and electricity). If you have other expenses (say you need to buy a computer for work purposes), you just need to notify the tax office. Be careful with tax credits though, they use your gross income minus any pension, that's it. I wasn't allowed to claim the same percentage of my utilities or a computer as a work expense.

Dazed_and_confused

I recently found out that I could claim Tax Relief for working from home,

Tax relief is the clue. You are claiming tax relief on an expense. Depending on your taxable income for the year an expenses claim of £208 will save you anywhere between £0 and (in extreme circumstances) £129 in tax.

Depending on where you are resident for tax purposes the amount most people are likely to benefit by is between £39 and £43.