WfH tax relief for 2022/23?

tebthereb

In most cases HMRC won't accept relief for working from home is available to an employee where there are appropriate facilities available for them to perform their job on their employer's premises.

In many cases, employers do not have adequate office space to accomodate all employees working from the office. This was true of course before COVID but many employers have, and will, downsize to reflect hybrid working arrangements that result in the need for less people in the office on any given day. As a result many employers "allow" employees to work from home.

Does anyone know whether, in this situation, HMRC accept that there are not "appropriate facilitiies available" to the employee?

Jeremy535897

Read https://forums.moneysavingexpert.com/discussion/6354316/am-i-required-to-work-from-home#latest

Semple

tebthereb said:

In most cases HMRC won't accept relief for working from home is available to an employee where there are appropriate facilities available for them to perform their job on their employer's premises.

In many cases, employers do not have adequate office space to accomodate all employees working from the office. This was true of course before COVID but many employers have, and will, downsize to reflect hybrid working arrangements that result in the need for less people in the office on any given day. As a result many employers "allow" employees to work from home.

Does anyone know whether, in this situation, HMRC accept that there are not "appropriate facilitiies available" to the employee?

I have similar set of circumstances, although my employer has classed us as hybrid workers, so I'm not allowed to use our offices 5 days a week. Because of the hybrid working, they've actually reduced office capacities.

Based on that, I'm satisfied I meet the requirements set out to claim the WFH relief.

tebthereb

Jeremy535897 said:

Read https://forums.moneysavingexpert.com/discussion/6354316/am-i-required-to-work-from-home#latest

Thanks. The OP there probably explains the position that I had in mind more eloquently than I actually did myself.

The HMRC manual that you refer to does not, as you say, really deal with the situation precisely. Of the two relevant examples, the first says:

"Example 8 – no appropriate facilities at employer’s premises

A company employs a team of sales people whose job is to follow up sales leads by telephone. The company trades from two small offices which house the director, her secretary and two clerical staff. There is no room for the sales team, who are recruited specifically on the basis that they will work from home. The members of the sales team are entitled to a deduction for the additional costs which they incur by working at home."

Their comment that there is "no room" perhaps offers some hope to those looking to claim on the basis there are "no appropriate facilities", but ultimately HMRC's conclusion here probably turns on the fact that the sales team are recruited "specifically on the basis that they will work from home" (which feels more like a conclusion regarding choice than facilities).

The other relevant example says:

"Example 11 – appropriate facilities available at employer’s premises

F is a teacher at a secondary school. During term time she regularly takes work such as marking exercises home to complete in the evenings and at weekends. However she has free periods during the school day and the school has rooms available where she can mark papers if she wishes to do so. F is not entitled to a deduction for the expenses of working at home because appropriate facilities are available on her employer’s premises. She may feel that those facilities are inadequate, but that is not enough to satisfy the statutory test, see EIM70735. It is not an objective requirement of her job that she should perform any of her duties at home."

This example doesn't help much, other than to confirm that "choice" is a problem and that an employee's perception that there is no room is not sufficient. Is there an objective requirement for someone to work at home where their office doesn't have enough room for them and every employee to attend the office should they choose to do so? It doesn't help answer this.

To me this all seems grey enough that claiming on the basis there are inadequate facilities would be possibe, based on the points HMRC state when trying to make a claim online. It's interesting that HMRC don't make any reference to choice when asking you to confirm the rules are met when claiming online, yet their online manual EIM32760 does in the last bullet point:

• 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 (see EIM32780)
• 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 them to travel to those premises on a daily basis)
• 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

(My emphasis added)

Based on this manual, someone choosing to WFH because the office would be overcapacity if they and all their employees attended the employer premises could probably argue there are not approprioate facilities available but would presumably fail the requirements due to them "choosing".

The rules are not fit for purpose and I would be inclined to go back to statute as HMRC's guidance is so poor.

Jeremy535897

The statute does not really help (section 336 ITEPA 2003):

"336 Deductions for expenses: the general rule

(1)The general rule is that a deduction from earnings is allowed for an amount if—

(a)the employee is obliged to incur and pay it as holder of the employment, and

(b)the amount is incurred wholly, exclusively and necessarily in the performance of the duties of the employment.

(2)The following provisions of this Chapter contain additional rules allowing deductions for particular kinds of expenses and rules preventing particular kinds of deductions.

(3)No deduction is allowed under this section for an amount that is deductible under sections 337 to 342 (travel expenses)."

There are no "additional provisions" relevant to WFH. Therefore, you have to look at case law. The case of Kirkwood v Evans confirmed that merely because an employee chooses to live far away from his place of employment, that does not entitle him to claim expenses as a result. See https://www.gov.uk/hmrc-internal-manuals/employment-income-manual/eim32374

The other hurdle that catches most people out is that any holder of the job would have to incur the same or similar expenses. See Ricketts v Colquhoun discussed at https://www.gov.uk/hmrc-internal-manuals/employment-income-manual/eim31641

When the rule was that if you had to work from home for one day in the tax year (usually because of government COVID restrictions), you could claim for the whole year, that might help in hot desking situations. In theory, all you would have to do is present evidence that the employer had no premises from which you were able to work on a particular work day, and then you could claim the whole year. That evidence might be very hard to come by, although it would be very easy for employers to achieve it, if your office uses key card technology, as your card could be inactivated for a work day when no room was available.

What usually happens in these situations is that more and more people try claiming, HMRC take notice and start denying claims, and the best case is taken to the Courts.

eLdn123

What I've noticed through my online tax account is that the amount can be claimed for the entire year, just like during COVID, only now requirements differ as the government no longer mandate people to stay at home ( which is the 3rd option to be chosen when looking at the application ). I have a question related to this, as I am starting a new job, and although I have a location assigned to me, the entire onboarding process is remote ( and this takes around a month ). Would being informed by the employer that the onboarding is remote qualify for the break ? Thanks !

Jeremy535897

Does "onboarding" involve carrying out the duties of your employment, as required by section 336 ITEPA 2003?

eLdn123

Jeremy535897 said:

Does "onboarding" involve carrying out the duties of your employment, as required by section 336 ITEPA 2003?

During the onboarding process there will be several meetings around technology and processes within the company, such as how to deploy new code within the infrastructure ( I work in tech ) and other such meetings, and also self paced training sessions on different topics ( ranging from business code guidelines, to data science tools used ). I would believe, in my humble opinion, that these are related to my duties, but not sure what HMRC would say about this.

Jeremy535897

The issue is whether you are carrying out your duties, or are putting yourself in a position to carry out your duties (which would cause a claim to fail). It's not whether these matters are "related" to your duties (they are bound to be).

eLdn123

Jeremy535897 said:

The issue is whether you are carrying out your duties, or are putting yourself in a position to carry out your duties (which would cause a claim to fail). It's not whether these matters are "related" to your duties (they are bound to be).

The email from the employer states " remote onboarding process ", reason for which my laptop was delivered to my house. I didn't request to work from home, but all onboarding is performed remotely. I would believe I would be carrying out my duties during this time, as onboarding would be part of my duties, that's how I understand it at least, but I do not have much knowledge on the topic really. Thank you !